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Oil is stable below $ 108 per barrel
Written by: PaxForex analytics dept - Friday, 27 June 2014 0 comments
Benchmark Brent futures are stable below $ 108 per barrel as fighting in Ukraine increased geopolitical risk, supporting the market.
Data published earlier this week showed an accelerating of the U.S. services sector, which a little bit calmed markets, alarmed by weak Chinese data.
Oil prices were kept in check by new data pointing to a continuing slowdown in China, the world's second-largest economy, and the possibility of lower energy demand.
By 10:30 GMT yesterday, June’s Brent futures fell on 3 cents to $ 107.69 per barrel and closed trading of the previous day by decline on 87 cents. Futures on U.S. light crude fell to 1 cent to $ 99.47 after falling to 28 cents on Monday.
"Data on the services sector added to evidence that the U.S. economy is indeed recovering, helping to maintain the growth prospects of oil demand in the United States." said Tang Chi Tat of Phillip Futures.
The rising of oil prices constrain significant reserves: it is expected that commercial oil stocks in the United States reached a new record high for the third consecutive week because of high import.
American Petroleum Institute (API) will issue its weekly report on inventoriessoon, as well as the U.S. Energy Information Administration will publish its release.
analysts expect growth of oil reserves in the week ended on May 2 by 1.5 million barrels.
Meanwhile, Russia's state pipeline operator halted diesel shipments to Ukraine and Hungary in April, over doubts as to the pipeline's ownership.
The resumption of oil exports from Libyan ports has bolstered supply and put pressure on prices, as production currently stands at 250,000 barrels a day. The country's crucial El Sharara oilfield remained closed at the beginning of this week, according to a spokesman for the state run National Oil Corp.