Gains in Current Crude Futures Prices Ends Three-Day Decline

U.S. crude futures prices moved beyond $90 per barrel and are on their way to break three consecutive days of losses  aided by short-covering and figures showing an unexpected fall in crude supplies in the United States.

The crude price per barrel on the NYMEX for delivery in November moved 35 cents higher to $90.33 after ending the previous trading day lower by $1.39 per barrel at $89.98, its lowest closing level since the 2nd of August in the midst of concerns on the growth of the global economy.

The contract previously dropped to a low of $88.95, the lowest intraday level since $87.23 posted on the 3rd of August.

The crude price per barrel of Brent for delivery in November was 20 cents higher at $110.33 after ending lower by 41 cents.

The tension between Iran and the West over the former’s nuclear program also supported prices. The president of Iran recently said that his country was constantly faced with military action threats and asked for a new global action not led by Western nations.

Concerns about the debt crisis of Europe kept on dragging prices lower. But, anti-austerity protesters and police tensions in Madrid and Athens pushed the euro to its lowest in two weeks versus the dollar.

According to the Bank of Spain, the gross domestic product of the country significantly dropped during quarter three, helping push European equities to their worst session in a two-month period. In the United States, crude supplies unexpectedly shed 2.45 million barrels in the past week as imports of crude declined.

The inventories of U.S. gasoline also posted an unexpected drop of 481,000 barrels. Meanwhile, distillate supplies, which consist of heating oil and diesel, posted a 482,000-barrel loss to 127.75 million barrels versus the average forecast of analysts of an 800,000-barrel rise.

Sudan and South Sudan’s leaders recently reached a deal on border security that will resume badly required exports of oil. However, it was not able to resolve the remaining major disagreements when the biggest country of Africa split in the past year.

The south had closed down all of its daily output of 350,000 barrels in the month of January following an argument between the two nations over transit fees.

By: Chris Termeer