Tuesday US Benchmark crude-oil futures suffered some losses in electronic trading. The dollar gained more momentum causing crude’s loss of ground. In addition the market was close, yet to be opened later that day.
In East Asian trading hours Crude future contracts for Delivery in March traded at $95.53 per barrel. The oil price was 12 cents less that the one from yesterday. Tuesday price was 33 cents below it the levels of Friday’s settlement on the New York Mercantile Exchange. The Nymex was closed on Monday for Presidents Day holidays.
Today the US dollar gained more strength causing immediate effect on crude prices. The ICE dollar index rose to 80.603 from the 80.572 level recorded Monday.
The stronger US currency always tends to depress oil price since dollar-denominated crude costs more to other currencies holders.
At the same time London-traded April Brent North Sea crude futures gained 5 cents. This is less than 0.1% as the contract traded at $117.43 per barrel. Yet, Friday’s settlement price of $117.66 was higher than Tuesday’s.
According to leading GFT markets technical analyst the outlook for Brent crude is still on the bullish side. He explained that buyers stepped in around the threshold of $116.70 per barrel. This price has resistance-based support level. In other words oil traders are still willing to buy the dips. The expert suggests a Brent crude resistance at $118.00 per barrel. As for Nymex crude expectations go for between $95 and $98 per barrel price.
Meantime a longer-term Brent forecast was posted by BofA Merrill Lynch Global Research report. According to the report oil is seen in an average range of $100 to $130 a barrel by 2015.
Though, Merrill Lynch analysts have lesser expectations for Nymex benchmark. That’s because surging shale production in the US raises a $50 per barrel risk over a period of one to two years.
Next week further talks on Iran’s nuclear program are up for an oil market risk. The supply tensions are growing in addition to the significant petroleum exports cut of Tehran.
On Wednesday US economic data report for January is awaited to be announced to the public. Philadelphia Fed index and leading indicators will be posted a day later this week.
