Oil spot price: WTI and Brent recover thus far today, spread widens

on Jan 9, 2014
Updated: Oct 21, 2019
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_iNVEZZ.com: Thursday, January 9th:_

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**Crude oil**
West Texas Intermediate (WTI) oil yesterday fell to its lowest point since 29 November, at $92 a barrel despite data from the US Energy Information Administration (EIA) on Crude Oil Inventories, which showed a fall of 2.7 million barrels last week – a sixth consecutive drop.
However, a significant rise of 6.24 million barrels of gasoline inventories was reported, while the distillate stocks, which are more closely watched by traders due to the anticipated increased winter demand in the US, grew by 5.83 million barrels.

The EIA report showed that while gasoline and distillates inventories rose, their overall demand fell by just under four percent to its lowest point for nearly seven months.
WTI today recovered slightly from its six week low on speculation that losses in the prior several sessions may have been excessive. The commodity rose by 34 cents to trade at $92.68, well below the $95 expected by analysts.

On the daily chart the Relative Strength Index (RSI) yesterday dropped to its lowest level in eight weeks. WTI’s RSI was below the reading of 32, and levels below 30 usually indicate that “prices have fallen too quickly for further losses to be sustained”, according to Bloomberg.
Nomura Holdings regional head of oil and gas research Gordon Kwan says that “oil has been falling, so technically it’s due for an oversold bounce”.

WTI is expected to remain rangebound today with investors awaiting tomorrow’s release of US Non-Farm Payrolls data. The stronger US dollar also weighed on oil prices.

Brent oil today has been rising and has reached its highest level since Friday, at $108. The spread between WTI and Brent is currently around $15 a barrel, a small rise from $14.84 yesterday.

Libya’s oil and gas minister Abdulbari Al Arusi says that the government will sue every foreign firm which attempts to buy oil, offered in the past few days, from ports seized by armed protesters. He also says that Libya will stop trading relations with such companies.
Gasoline prices are holding at $2.6649 down after the surprising climb in inventory. Heating oil is trading flat at 2.9571.
**Natural gas**
The EIA will today release last week’s Natural Gas Inventories. Analysts expect a drop of 147 billion cubic feet.
Natural gas is currently trading at $4.165 per 1,000 cubic feet after declining yesterday from around $4.30 after the cold storm eased. It was the biggest drop since 21 October.
US natural gas prices fell yesterday following forecasts for warmer weather. Private forecaster MDA called for a warm surge over the next one to five days.

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