Crude Oil Stabilizes around $75.50 a Barrel
Posted on 07. Dec, 2009 by admin in Crude Oil
Crude oil saw a very volatile session during last week’s trading. Crude oil began the week with a rising trend, reaching $78.85 a barrel. However, as the week continued, oil lost most of its gains and is currently trading around $75.50 a barrel.
Crude oil rose earlier last week due to hopes that economic recovery is on the horizon. The expectation that the U.S Non-Farm Payroll’s result would show another halt in the unemployment condition led investors to believe that demand for energy will strengthen. The surprising end result, which showed that the Unemployment Rate in the U.S has improved during November, had two effects. First, expectations for a global recovery have supported crude oil prices, and the immediate reaction was a rise in crude oil’s value. Second, the Dollar strengthened as a result. Considering that crude oil is valued in Dollars, an appreciation of the Dollar usually means a drop in crude oil prices. This is exactly what happened.
Looking ahead to this week, traders are advised to follow the main publications from the U.S economy, as they tend to determine oil’s value. In addition, traders should also follow the U.S Crude Oil Inventories report on Wednesday, as this report has proven to have an instant impact on the market.
