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Crude Below $95.00 Amid Fed Stimulus Worries

Published 11/04/2013, 04:27 AM
Updated 07/09/2023, 06:31 AM
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Crude oil rose on Monday as investors took fresh positions after the previous session`s steep fall when prices fell towards the $94.00-mark, however prices are set to remain weak amid expectations the US Federal Reserve will cut its monetary stimulus.

The upbeat US factory output and jobless claims stirred speculation the Fed may roll back its monetary stimulus in December, instead of March, boosting the dollar index which jumped to a 7-week high above the 80.00 mark, weighing on most commodities.

- WTI crude oil futures for December is trading around $94.70 a barrel after rising $0.09

- Brent futures for December settlement is trading around $106.28 a barrel after rising $0.39

Now the direction of oil prices may depend on the outcome of a number of key data such as the US growth and employment numbers due later this week. If the data would point to a strong recovery in the US, expectations the Fed would cut back its stimulus will rise.

That would lower the dollar supply in the market, pushing the currency higher and adding downside pressures on the dollar-dominated commodities including oil, which already faces pressures from the easing tensions between Iran and the West.

- Natural gas is trading at $3.432 per cubic feet after falling 2.31%

- Gasoline is trading at $2.547 per cubic feet after rising 0.06%

- Heating oil (diesel) is trading at $2.889 a gallon after rising 0.24%

Although oil markets are amply supplied and the global economy remains weak, the deepening crisis is Libya helps keeps oil supported. Leaders of an autonomy movement in the country’s oil-rich east declared a regional government on Sunday.

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