23 October 2013 13:13 [Source: ICIS news]
LONDON (ICIS)--NYMEX WTI crude oil futures weakened by more than $1.00/bbl on Wednesday amid a disappointing US jobs report, rising crude inventories and fears of deflation in Europe.
By 10:53 GMT, the front-month December NYMEX WTI contract had touched an intra-day low at $96.66/bbl, a loss of $1.64/bbl compared to the previous close. The contract then edged higher to trade around $96.80/bbl.
At the same time, the front-month December ICE Brent contract was trading around $109.40/bbl, having touched an intra-day low earlier at $108.86/bbl, a loss of $1.11/bbl compared to the settlement on Tuesday.
Crude oil futures were pressured by the delayed September US jobs report that showed the country added only 148,000 jobs in September, lower than the forecast of 180,000 jobs, indicating that the US economic recovery remains fragile. The jobs report is likely to provide further incentive for the US Federal Reserve to postpone the tapering of its $85bn/month asset purchase programme.
Adding to the bearish sentiment in the market, US crude oil stocks are expected to have increased last week by 2.90m barrels, according to forecasts. Crude stocks rose by 4m barrels a fortnight ago, according to a delayed stock report from the US Energy Information Administration. The delay in publication was caused by the temporary partial shutdown of the US government due to a stand-off between US lawmakers regarding the budget and debt ceiling.
In Europe, there are growing concerns over deflation in some countries, namely Greece, Bulgaria and Latvia, which are all experiencing deflationary pressures, according to September data. Other European countries, such as Spain, Portugal and Ireland, are also edging closer to deflation. When a country enters a period of deflation, the real value of its currency rises as goods and services become cheaper. However, the real value of debts will rise, making real debt payments higher.
For the latest chemical news, data and analysis that directly impacts your business sign up for a free trial to ICIS news - the breaking online news service for the global chemical industry.
Get the facts and analysis behind the headlines from our market leading weekly magazine: sign up to a free trial to ICIS Chemical Business.
|ICIS news FREE TRIAL|
|Get access to breaking chemical news as it happens.|
|ICIS Global Petrochemical Index (IPEX)|
|ICIS Global Petrochemical Index (IPEX). Download the free tabular data and a chart of the historical index|
Asian Chemical Connections