Crude oil futures prices closed higher on Thursday (2nd) as the U.S. dollar weakened after the Federal Reserve (Fed) decided to keep key interest rates unchanged, halting the decline in oil prices after three days in a row.
Energy Commodity Prices West Texas Intermediate (WTI) crude oil futures for December delivery rose $2.02, or 2.5%, to settle at $82.46 a barrel. Delivered in JanuaryBrent crude oil (Brent) futures prices rose $2.22, or 2.6%, to close at $86.85 a barrel. Gasoline futures for December delivery rose 2.8% to settle at $2.25 a gallon. Delivered in DecemberThermal Fuel FuturesPrices rose 2.2% to $3.03 per gallon. Natural gas futures for December delivery fell 0.6% to settle at $3.47 per million Btu.market drivers
In Brent and WTI crude oilBefore closing higher on Thursday, it had closed lower for three consecutive trading days.
American benchmark WTI crude oilPrices closed Wednesday at their lowest close since Aug. 28, having fallen nearly 11% in October, erasing gains made four weeks ago after Hamas attacked southern Israel.Brent crude oilIt closed Wednesday at its lowest since Oct. 6, the last trading day before the Hamas attack.
Phil Flynn, senior market analyst at Price Futures Group, said that oil prices rebounded because “the market believes” that the United States may have ended raising interest rates, but “the war in Gaza continues.”
Market observers pointed to a weakening dollar, a surge in U.S. stocks and a fall in U.S. Treasury yields following the Fed’s decision not to raise interest rates. Overall, a generally upbeat trading tone in global markets helped boost crude oil.
Colin Cieszynski, chief market strategist at SIA Wealth Management, said on Thursday that U.S. Treasury yields have been falling since the Fed meeting, dragging down the dollar and removing headwinds from oil and other commodity prices.
Analysts continue to watch the Israel-Kazakhstan war for signs of potential premiums that may involve Iran. After the outbreak of the Israel-Kazakhstan war, the price of crude oil was pushed up because the market was worried that the expansion of the conflict might involve Iran, leading the United States to impose stricter oil export sanctions on Iran. The worst-case scenario is that Iran or its representatives will use the region’s major transportation hubs and infrastructure as a threat.
However, since the war between Israel and Kazakhstan did not expand, prices have fallen since then. David Morrison, senior market analyst at Trade Nation, said prices returning to pre-war levels suggested the market did not expect the conflict to expand.
However, Sevens Report Research analysts note that the possibility of disruption to oil production, infrastructure or logistics operations remains. “Until there is a ceasefire, this threat will put short sellers on alert, leaving the market vulnerable to a massive short squeeze.”
Other energy trading
The U.S. Energy Information Administration (EIA) announced on Thursday that U.S. natural gas inventories increased by 79 billion cubic feet last week (10/27).
Analysts on average forecast an increase in natural gas inventories of 83 billion cubic feet last week, according to a survey by S&P Global Commodity Insights.
2023-11-02 22:06:54
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