Crude Oil and Natural Gas Update

FXEmpire   |  February 6 2013 1:14 EST

By FXEmpire.com

Crude oilwas trading slightly higher tracking rise in benchmark contracts on the New York Mercantile Exchange, where weak US dollar against the euro supported recovery in oil futures. Crude is priced at 96.67 adding 3 cents so far today. Brent’s premium to light sweet crude increased to $20.1 per barrel, the widest this year.

Crude oil futures closed higher on Tuesday, supported by positive economic data’s from the United States and Europe. The dollar index, which measures the greenback against a basket of six major global currencies, traded at 79.504. The euro pared early losses on Tuesday, to turn flat on the day against the dollar as investors bought back the common currency on dips after it fell on the previous day due to political worries in Italy and Spain. In the US, the Institute for Supply Management (ISM) Non-Manufacturing Purchasing Managers’ Index declined by 0.9 points to 55.2-mark in January as against a rise of 56.1-level in December

French President Francois Hollande urged the eurozone to set a mid-term target for its currency’s exchange rate and to forge a jobs policy to fight voter disillusionment.

Iran and world powers announced on Tuesday, new talks were scheduled for Feb. 26, but hopes for progress were limited by comments from an Iranian official suggesting the West’s goal in talking was to undermine the Islamic republic

The weekly EIA inventory is expected to show that crude oil added +3mn barrels on for the week ended February 1, 2013. The American Petroleum Institute (API) report last night, US crude oil inventories rose more than expected by 3.6 million barrels to 371.83 million barrels for the week ending on 1sr February 2013. Gasoline inventories gained around 1.6 million barrels to 233.53 million barrels and whereas distillate inventories declined by 1.4 million barrels to 128.81 million barrels for the same week.

Natural gas futures climbed to their highest price in more than a week, on forecasts of unusually cold weather that will stoke demand for the heating fuel. Natural gas is trading at 3.403 dipping 18pips, as traders took advantage of the price surge to sell off and book profits. Speculators can expect gas prices may continue its upside move on speculation of higher demand for electricity consumption in comparison to nuclear power. Inventory reports due today is expected to fall by 125 BCF, which may further support the upside move. However, according to the MDA weather service meteorologist, weather is likely to remain mild/ normal in the current week which may limit the upside.

Click here for further Crude Oil Forecast.

Originally posted here