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Oil prices fall… Brent crude oil falls below $81

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Oil prices fall… Brent crude oil falls below $81

Oil prices fell during trading today, Thursday, November 16 (2023), amid fears of a slowdown in demand, continuing hemorrhagic losses for the second consecutive session.

It comes after signs of increased supplies from the US contributed to concerns about China’s weak energy demand. US oil inventories rose by 17.5 million barrels in the past two weeks (to November 10), bringing the total to 439.4 million barrels.

Yesterday, Wednesday, November 15, oil prices ended trading down about 2% after the release of data revealed a strong increase in US oil inventories.

Oil price today

By 06:49 AM GMT (09:49 AM Mecca Time), benchmark Brent crude futures for January 2024 delivery were down 0.37% at $80.88 a barrel.

At the same time, US West Texas Intermediate crude futures for delivery in December 2023 fell 0.50% to $76.28 a barrel, according to figures tracked by the Specialized Energy Site.

The first-month WTI contract is trading below the second-month price, indicating that investors are expecting higher oil prices; The first-month discount for the second month traded at minus 17 cents on Thursday.

An oil storage platform in Japan – Photo from Reuters

Oil price analysis

“Concerns about higher production rates in the U.S. have put new pressure on oil prices, adding to an already worrisome demand outlook,” said Tina Deng, market analyst at CMC Markets.

According to the US Energy Information Administration, US crude oil inventories rose by 3.6 million barrels last week to 421.9 million barrels, exceeding analysts’ expectations. Reuters An increase of 1.8 million barrels.

U.S. crude production held steady at a record 13.2 million barrels per day.

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In Asia, China’s oil refining output fell in October from a record high in the previous month as demand for industrial fuels weakened and refining margins narrowed. However, economic activity picked up in October as industrial output rose faster and outpaced retail sales growth. forecast.

Data released Thursday morning underscored concerns about China’s real estate sector, with new home prices falling for a fourth consecutive month in October and property sales falling 20.33% year-on-year.

“Technical factors also limit any upward movement in oil prices,” said Yip Jun Rong, IG market strategist, adding that oil supply and demand dynamics have been less important in months; There are some pullbacks from previous bullish positions.

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Economy

EUR/USD Analysis Today: Euro Looking for Buyers

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EUR/USD Analysis Today: Euro Looking for Buyers

The Euro went back and forth during Thursday’s session, focusing on the 200-day EMA, an indicator that people sometimes focus on. At the same time, the market found itself testing the 1.0750 level, which had previously led to significant price volatility. Taking all factors into account, this situation highlights the situation where the Euro is preparing for a consolidation mode, which is waiting for an improvement in the US bond markets. Interest rates have played an important role in currency markets in recent times as traders discern the Federal Reserve’s stance on monetary policy – ​​whether it will ease or maintain a more conservative approach.

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Also, the recent decline in interest rates may indicate market expectations of an impending economic downturn, which tends to promote the safe-haven status of the US dollar. This dynamic manifests itself in increased demand for US bonds, which subsequently leads to lower yields and higher demand for the US dollar.

Further complicating the situation is the influx of capital into Europe, which is struggling with the problems of the Great Recession. Overall, prevailing landscape traders face short-term rallies, although support should remain in the intervention area. It’s worth noting that next Friday’s session will be important, as employment data could influence the central bank’s course of action, or at least the perception of what it may or may not do. The market will continue to ask a lot of questions about the EU, which will favor the US dollar. Additionally, if the world slips into a major recession, the US dollar is usually a safe haven for traders.

See also  The euro fell below $ 1.06 for the first time in five years

Ultimately, the Euro is going through a challenging environment right now and the 1.0850 level is one to watch as it struggles with various factors. A break of this level could indicate an upward trend, although the current momentum is insufficient to facilitate such a move. It’s conceivable that a significantly weaker employment report could give the markets the momentum they need to return to volatility and make this market move very quickly. However, as we approach the end of the year, this could mean a decrease in volume, making markets difficult to predict.

Daily chart of EUR/USD

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Economy

Oil falls to lowest level in last 6 months

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Oil falls to lowest level in last 6 months

Oil prices fell to a six-month low on Thursday, driven by investor concerns about slowing energy demand in the United States and China at a time when U.S. production is near record highs.

Brent crude futures were down 25 cents at $74.05 a barrel, while US West Texas Intermediate crude futures were down four cents at $69.34, with both crudes hitting their lowest levels since late June.

John Evans, an analyst at PVM Oil, said: “Demand from the biggest global oil importer (China) is under pressure on prices, especially with the continuation of record production by the largest producer, the US.”

U.S. production is at an all-time high of more than 13 million barrels per day, according to U.S. Energy Information Administration data.

The Energy Information Administration said U.S. gasoline inventories rose 5.4 million barrels last week to 223.6 million barrels, more than five times the expected increase of one million barrels.

Concerns about the Chinese economy also limited oil price gains.

Chinese customs data showed crude oil imports fell 9 percent in November from a year ago due to higher inventory levels, weaker economic indicators and lower demand from independent refineries.

Although China’s total imports fell month-on-month, exports grew in November for the first time in six months, suggesting rising global trade flows could help the manufacturing sector.

Oil prices have fallen about ten percent since the Organization of the Petroleum Exporting Countries (OPEC) and the OPEC Plus group – which includes allies including Russia – announced a voluntary production cut of 2.2 million barrels per day in the first quarter of next year.

See also  The euro fell below $ 1.06 for the first time in five years

On Thursday, the biggest oil exporters, Saudi Arabia and Russia, called on all OPEC Plus members to join a deal to cut production for the benefit of the global economy.

(Reuters)

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Economy

Gold rises as dollar weakens and U.S. jobs data expected by Reuters

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Gold rises as dollar weakens and U.S. jobs data expected by Reuters
© Reuters. Gold nuggets in a photo from the Reuters archive.

By Harshit Verma

(Reuters) – As the dollar fell on Thursday, investors could look to U.S. jobs data released later this week for fresh clues on the Federal Reserve’s path on interest rates.

It was up 0.3 percent at $2,030.20 an ounce by 0748 GMT. US gold futures were at $2,047.10 an ounce.

It fell 0.3 percent against rival currencies, with gold prices lower for holders of other currencies, while the 10-year yield hit a three-month low.

U.S. data released this week showed signs of a gradual slowdown in the U.S. labor market, with job openings falling to their lowest level in two-and-a-half years in October, while private sector employment rose less than expected last month.

Investors await U.S. nonfarm payrolls data to be released on Friday before the Federal Reserve updates its economic forecasts and interest rates at its fiscal policy meeting scheduled for Dec. 12-13.

“There is a widespread expectation that non-farm payrolls will be lower,” said Nicholas Vrabel, head of global corporate markets at ABC Refinery.

According to CME Group’s FeedWatch service, 60 percent of traders expect interest rates to fall by March 2024. Low interest rates support gold, which does not generate income.

For other precious metals, it was $23.87 per ounce. Platinum rose 0.5 percent to $894.03. An ounce was up 0.7 percent at $950.42.

(Prepared by Noha Zakaria for Arabian Bulletin – Editing by Salma Najm)

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