WTI oil trading near $80 as US crude gets wacked 6.2 percent lower

23 September 2011 23 September 2011

BonTrade

WTI oil futures open Friday’s trading session back around $80 a barrel as US crude gets wacked lower by over 6 percent in a gloomy sell off in markets yesterday as traders rushed out of risk based assets and stock markets fell.

Latest WTI Oil Price

US Light crude oil futures for November 2011 delivery was trading at $80.59 a barrel, 06.00 GMT this morning in electronic trading on the NYMEX. The US contract closed yesterday’s session down 6.2 percent at $80.51.

Highs and Lows

Just a week after NYMEX oil WTI prices hit a one month high, they are now hitting a one month low, with a 10 percent swing in between. US Light crude oil futures are now back down in the price range last seen in the autumn of 2010.

The ICE US Dollar Index contributed to the steep fall in oil prices as currency traders sold the euro and piled back into the dollar, still seen by many as a safe haven currency, of sorts. A strong US dollar drives oil prices lower, as dollar denominated commodities becomes more expensive for buyers using other currencies.

“We’re just not seeing any real signs of life out there economically. Traders are heading to higher ground. There is just a lot of doom and gloom out there in the markets.” said Rob Kurzatkowski, futures analyst with OptionsXpress.

Stock Markets

Stock markets tumbled on in trading yesterday as investors took fright at a gloomy warning about the world economic outlook from the US central bank. In Asia, the Nikkei closed down 2.1 percent, Hong Kong’s Hang Seng tumbled 4.9 percent and the Jakarta stock market lost nearly 9 percent. Asian markets continue to look negative this morning.

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