Oil price: Brent trades close to 27-month low

By:
on Oct 9, 2014
Updated: Oct 21, 2019
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**Crude Oil Price**

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iNVEZZ.com, Thursday, October 9: The price of Brent crude has remained in sight of a 27-month low hit yesterday, as US dollar weakness after a more dovish stance by the Fed at its latest policy meeting was offset by a surge in US crude stockpiles.
Brent for November delivery was up 0.27 percent, or 25 cents at $91.63 per barrel as of 10:13 BST on the London-based ICE Futures Europe exchange. The contract fell as low as $90.57 yesterday, the weakest since June 2012, before recovering to close at $91.38, down 73 cents for the session.

Oil prices received some support from a decline in the US dollar, which fell after the Federal Reserve published its September meeting minutes yesterday that indicated a more cautious stance. The announcement sent the US dollar index (DXY) to a two-week low of 84.93, after it hit a four-year high of 86.74 on Friday. It was at 85.09 as of 09:54 BST today, a 0.24 percent daily decline.

“With a weakened US dollar, we expect crude prices to continue to consolidate for the rest of the day,” said Daniel Ang, analyst at Phillip Futures, as cited by The Wall Street Journal.
Any significant crude price rallies were restrained by a bigger-than-expected expansion of five million barrels in US crude stockpiles for the seven days ended 3 October. The data was contained in a report by the Energy Information Administration (EIA), published at 19:00 BST yesterday. The figure was more than double the two million build forecast in a Bloomberg News survey.

“Although the return of significant Libyan production has been an important factor putting downward pressure on the Brent price, weakening global demand, particularly in Europe and Asia, is also important,” EIA analyst Michael Leahy said in a note yesterday.

November WTI futures rose 0.44 percent, or 38 cents to $87.69 per barrel in electronic trading on the NYMEX in New York as of 10:13 BST. The contract ended the previous session $1.54 in the red and touched an intraday low of $86.83, its weakest since April 2013.
Phin Ziebell, an oil analyst at National Australia Bank, was quoted by Reuters saying:
“Demand has been pretty slack and there’s oversupply. Any negative economic data out of Europe or China has reinforced this orthodoxy so prices fall further […] If we see the US recovery on track there should be stabilisation in sentiment.”
As of 10:13 BST, Brent was trading at a premium of $3.94 to WTI, compared with $4.07 yesterday, which was the widest in two weeks.

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