CRUDE SUMMARY: Oil futures bearish on broader risk aversion

Source: ICIS News


LONDON (ICIS)--Crude oil prices were bearish in early session, still recoiling from a 9.7m bbl increase in US crude stocks, the second large weekly increase in a row. Despite OPEC Secretary General Mohammad Barkindo expressing concerns about the cartel’s spare capacity and the lack of investment in new oil reserves, the market failed to pick up any bullish signal. Prices lost further momentum on the large sell-off from broader risk aversion from investors and hedge funds. A weaker US stock market indirectly helped to drag global sentiment down. In the meantime, higher bond yields and heightened volatility levels helped pull investors away from the commodity markets, including oil. In afternoon trading, oil futures dipped further on data showing another large increase in US crude stocks. The mothballing of several US refineries for their seasonal turnaround has reduced the call on domestic stocks and resulted in another 6m built-up in oil inventories. The price curve merely shrugged off the news, remaining firmly on the downside.

Low High Open Settle Change
Brent December 79.8 82.63 82.47 80.26 -2.83
WTI November 70.89 72.76 72.68 70.97 -2.2

Julien Mathonniere