US crude futures slide $1.61/bbl on downside correction

11 July 2013 20:54  [Source: ICIS news]

HOUSTON (ICIS)--NYMEX light sweet crude (WTI) for August delivery settled at $104.91/bbl, down $1.61, on profit taking to overbought conditions.

Since the August contract moved to spot month on 21 June, WTI had risen more $13/bbl, topping out during Thursday's session at $107.45/bbl, up 93 cents versus the previous settlement, before showing signs of exhaustion.

Unconfirmed reports that the Seaway Pipeline, carrying oil to the Gulf Coast from the Cushing, Oklahoma NYMEX delivery hub, had been shut down for a few hours also encouraged the length liquidation.

Downside momentum drove August crude down to establish an intra-day low of $104.31/bbl, down $2.21, before the dip was viewed as a buying opportunity.

The selling overshadowed a rally in the stock market and weakness in the US dollar, which provided support to other commodities such as gold and copper on expectations that the US Federal Reserve will maintain its monetary stimulus program.

ICE Brent, which had been narrowing the negative trans-Atlantic spread to WTI, did not lose as much ground, bottoming out at $107.26 before settling at $107.73/bbl, down 78 cents. The spread between the grades widened to $2.82.

By: Ignacio Sotolongo
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