Crude Oil Spikes on Better Inventory Data
Posted on 20. Feb, 2009 by admin in Crude Oil
Oil prices went to as high as $40.23 in yesterdays trading. However, by the close of trading the black gold was trading near $39.466, holding gains of nearly $2 from Wednesday’s closes. One of the main factors contributing to Oil’s gains was the U.S. Crude Oil Inventories Data. Crude stocks declined by 0.2 million barrels last week. Analysts had forecasted a rise in inventories by 2.9 billion. The other 2 factors that may have played in to Crude’s strength on Thursday were the Dollar’s weakness in early trading and a possible price correction in the black gold.
Crude prices may extend their gains today as investors may perhaps pursue take profits. This volatility of Oil in today’s trading is strongly dependent on Euro-Zone and U.S. data releases. Also, Crude may go bullish if investors feel that President Obama can handle the complex U.S. recession. The highest that Oil prices could reach by the end of today’s trading may be $41.00. If prices do hit this mark, they are likely to drop very quickly below $39 a barrel, as there is not enough confidence and physical demand to uphold this price level.
