US Crude Oil Falls as Supply Hits 1989 High of 8 Million Barrels per Day

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Commodities Trading

: 29 November 2013

The Thanksgiving holiday kept bargain hunters away from the energy sector, with US crude ending $0.12 down at $92.22.

An ongoing increase in overall oil supplies, coupled with struggling demand, sparked the downtrend from early October and, for the moment at least, there seems to be no end in sight.

For once, a weaker dollar spurred some demand for gold, with the precious metal gaining $7.4 to $1,244.7 yesterday.

The climb may have been supported by the thin trading conditions, however, whilst the technicals are pointing firmly lower, the physical demand is on the mend.



Commodities Trading

: 28 November 2013

WTI crude prices plunged to a new recent low of $91.75, the weakest level in almost six months, closing $1.14 down for the day at $92.36.

The main culprit was the weekly stockpiles report, which indicated a build of 3 million barrels last week to 391.4m overall, the tenth gain in a row.

Good news for US consumer confidence definitely did not bode well for the gold market which continued its slump, losing $5 to $1,237.

In terms of gold analysis, the short, medium and long-term trends are all pointing south and it seems that rising demand from Asia, especially China failed to put a stop to this orderly decline.



Commodities Trading

: 27 November 2013

And we are back to square one in the energy market.

Concerns that crude oil supply has risen to almost 8 million barrels per day, the strongest level since 1989, triggered a resumption of the downtrend for US crude.

As such, the market lost $0.65 to $93.51, with the historic Iranian agreement still keeping bargain hunters on the sidelines for now.

Gold prices gave back the previous day's gains, dropping $8.7 to $1,242.4, despite seeing a weaker dollar and ongoing optimism for equities.

The waning demand for safe haven assets is certainly keeping the yellow metal out of fashion.



Commodities Trading

: 26 November 2013

The price of WTI crude oil gapped $0.64 lower to $94.14 on the back of the Iranian deal as the Middle Eastern country is a major crude oil producer with sizeable reserves.

Although there were some analysts who suggested caution, the optimism in the energy sector could not be denied and easily translated into the falls.

Despite the initial reaction, however, the crude oil market hardly changed for the rest of the session.

A drop below the $1,240 mark for gold in early trading yesterday finally managed to entice some bargain hunting.

That pushed the precious metal prices $8.8 higher to $1,251, with reports of a revival in demand from Asia also offering some support.



Commodities Trading

: 25 November 2013

Despite ongoing rallies in the stock markets, coupled with a weaker dollar, crude prices remained around their recent lows as forecasts pointed towards rising inventories and struggling future demand.

As such, the price of WTI crude oil lost $0.46 to $94.74.

Moreover, oil futures opened sharply lower overnight and are falling rapidly after news broke about the Iranian Nuclear Deal which may see Iranian oil supplies hit the market.

Gold prices ended the week rather flat around $1,243 on a very quiet day that saw a trading range of less than $8.

In addition, and testament to the fact that gold is currently out of fashion, the yellow metal has seen an anaemic reaction to the news that Iran and the West have reached a nuclear agreement.


By Jonathan Sudaria, 29 November 2013


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