WTI oil futures end week at 3 month lows, US dollar gains

12 February 2011 12 February 2011

BonTrade

WTI oil futures end a puzzling week near $85 a barrel, as the spread between WTI and Brent oil contracts hit a record $16, while the US dollar made a mild comeback, as seen by movements on the US Dollar Index.

WTI Oil Futures – Closing Price

US Light crude oil futures for March 2011 delivery ended the week at $85.27 a barrel on the NYMEX, $3.70 a barrel lower than last week’s closing price of $88.97.

Meanwhile, the ICE US Dollar Index, which tracks the US dollar against six major world currencies was mildly higher at 78.48.

US Inventory Gains Weigh on WTI Oil

The weekly US oil inventory report out on Wednesday also proved to be a downside catalyst for WTI oil prices. The US EIA (Energy Information Administration) said that US crude oil inventories registered a fourth straight rise, while US petrol inventories hit a 20 year high. The EIA now forecast that WTI oil prices could average about $93 a barrel in 2011.

WTI oil futures sold off as investors interpreted this into evidence of a slowing American economy.