MarketsBuckle up! Oil roller coaster still running
The oil roller coaster continues.
After Brent crude surged more than 15 per cent over Thursday and Friday to close above $50 a barrel, in what most traders viewed as a short covering rally ahead of the long UK weekend, the international oil benchmark is dipping once again, writes deputy commodities editor David Sheppard.
By 10:20am London time on Monday, Brent was down 2.7 per cent to $48.69 a barrel while US benchmark, West Texas Intermediate fell 2.3 per cent to $44.18.
Traders said the oil market remains well supplied, while concerns remain about the health of China's economy after another volatile day on Shanghai bourses.
Analysts at Citi said that with near record Saudi Arabian and Iraqi production contributing to an almost 2m barrel a day oversupply in the market, they remained cautious on the outlook for crude.
The outlook for Saudi Arabia's official selling prices could be key, Citi said, with traders looking for indications whether the world's largest exporter rolls back supply after ramping up over the summer to meet domestic air conditioning demand. The latest figures, due early next month are "a critical measuring stick," Citi said, adding:
end quote from:
After Brent crude surged more than 15 per cent over Thursday and Friday to close above $50 a barrel, in what most traders viewed as a short covering rally ahead of the long UK weekend, the international oil benchmark is dipping once again, writes deputy commodities editor David Sheppard.
By 10:20am London time on Monday, Brent was down 2.7 per cent to $48.69 a barrel while US benchmark, West Texas Intermediate fell 2.3 per cent to $44.18.
Traders said the oil market remains well supplied, while concerns remain about the health of China's economy after another volatile day on Shanghai bourses.
Analysts at Citi said that with near record Saudi Arabian and Iraqi production contributing to an almost 2m barrel a day oversupply in the market, they remained cautious on the outlook for crude.
The outlook for Saudi Arabia's official selling prices could be key, Citi said, with traders looking for indications whether the world's largest exporter rolls back supply after ramping up over the summer to meet domestic air conditioning demand. The latest figures, due early next month are "a critical measuring stick," Citi said, adding:
If the Kingdom does not discount their crude it could be a strong indication of their walking back some of their new policy regime (to maintain market share).The one certainty right now appears to be volatility. The so-called fear index, the Oil Vix, spiked to a 5-month high last week.
end quote from:
- The oil roller coaster continues. After Brent crude surged more than 15 per cent over Thursday and Friday to close above $50 a barrel, in what most traders viewed as ...
No comments:
Post a Comment