The crude oil prices are still up today as demand from China is growing and the U.S. winter is just adding up to it. The price of oil stayed above $100 a barrel today as investors were expecting cold weather in the US and steady Chinese growth will underpin demand. In fact, the benchmark US crude for March delivery was up 35 cents to $100.65 a barrel at 0750 GMT on the NYMC.
A similar trend is being seen in Brent prices which are up. A major contribution is coming from the outages in the Buzzard oil field in the North Sea wherein a lot of disturbances are being seen. Also, there is a lot of disturbance in Libyan oil production and an assault by rebel soldiers on the South Sudanese oil town of Malakal has further aggravated the problem.
On the other hand, the US and Iran have voiced caution over the prospect of a deal to curb Tehran’s nuclear program. According to observers it is reducing chances of a diplomatic breakthrough that could pave the way for Iranian crude to return to global markets. ForexMinute had earlier reported that Iran exported record oil last month.
Investors are waiting for the weekly inventory report which was to be released on Wednesday would and will be released on Thursday as the US had a holiday on Monday and due to it, the report had been delayed by one day. The report is expected to show that inventories saw a significant decline last week.
As The US States facing Severe Cold Weather Conditions Fuel Requirements to Go Higher
On the brighter trading today, the ICE’s gas oil contract for March delivery was up $4.75 at $928.75 a metric ton. A similar pattern was seen in the Nymex reformulated gasoline blendstock for March where the benchmark gasoline contract went up slightly as it gained 66 points and closed at $2.8199 a gallon.
Nonetheless, as the US is facing severe cold weather conditions the fuel prices are expected to go up further. Particularly, after the reports that the US East Coast is expected to get more snow, and the cold is extending to other states, the requirement for fuel will go up further. This along with optimism that China’s economy is still healthy after credit growth increased in January is adding up to the oil prices.
To contact the reporter of this story: Jonathan Millet at firstname.lastname@example.org