Author: SondraHunter

The price of US WTI crude oil opened Wednesday’s trading session back at $100 a barrel after climbing 2 percent yesterday as Iranian comments surrounding the Strait of Hormuz had investors piling back into oil futures ahead of today’s OPEC meeting in Vienna.

Latest WTI Oil Price

US Light crude oil futures for January 2012 delivery was trading at $100.07 a barrel, 07.19 GMT this morning in electronic trading on the NYMEX.

The US oil contract closed yesterday’s trading session at $100.00 a barrel, $1.98 higher, or 2 percent.

OPEC Meeting

OPEC appears set to reach consensus over maintaining its official output quota at a meeting in Vienna today, as data showed that the cartel’s crude oil production was at the highest level for more than three years last month.

Kuwait’s Oil Minister Mohammad al-Baseeri said OPEC was likely to keep its production quota unchanged as the market was balanced and crude prices stable.

Analysts widely expect OPEC, which supplies a third of the world’s crude oil, to maintain its official output target of 24.84 million barrels per day, where it has stood for almost three years.

But with the IEA estimating that actual OPEC production hit 30.68 million barrels of oil per day in November, the highest amount in more than three years, OPEC may decide to issue a statement promising stricter compliance with its quotas.

Iran – Strait of Hormuz

WTI and Brent oil price jumped more than 3 percent in just minutes yesterday afternoon on a market rumour that Iran may close a major oil shipping channel, but then pared some gains as the rumour proved untrue.

Iranian MP Parviz Sorouri of the Majlis National Security and Foreign Policy Committee said “We will hold an exercise to close the Strait of Hormuz in the near future. If the world wants to make the region insecure, we will make the world insecure.”

The comments, picked up by the quasi official Iranian Student News Agency, and reported by the Tehran Times, were later complemented by a statement by the Iranian Foreign Ministry noting the Strait remains open.

The strait, located between Iran and Oman, is the most important oil shipping channel in the world.

Later, an Iranian official later dismissed the rumour, and a spokeswoman for the US Navy’s 5th fleet in Bahrain said shipping traffic in the strait was flowing normally.

“Rumours have a way of spreading around, and in this age of electronic markets, when you get something that starts to push prices up quickly, it triggers the stops and you get these explosions in prices.” said Tom Bentz, director of BNP Paribas Prime Brokerage.

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WTI crude oil price trading back at $100 ahead of OPEC meeting

Crude oil prices rebounded yesterday but gains were pared as the FOMC meeting turned out to be a non-event. The front-month contract for WTI crude oil initially jumped to a 3-day high of 101.25 before settling at 100.14, up +2.42%, while the equivalent Brent crude contract soared to as high as 111.1 before ending the day at 109.5, up +2.09%. Gold remained weak with the benchmark Comex contract plunging to 1625.5, the lowest level since October 21, before bouncing back to 1663.1 at close. Stock markets also got hit with DJIA losing -0.55% and S&P 500 dropping -0.87% yesterday.

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Financial Markets Remain Soft as Fed Fail to Ease Further

Financial markets made little response to the EU summit over the weekend. Although some measures were announced in an attempt to contain the sovereign crisis in the Eurozone, much uncertainty remained. Implementation risks of the measures were also high, making the feasibility and effectiveness of them questionable. In the commodity sector, WTI crude oil remained steady at around 99 and 108 respectively while gold moved sideways at around 1710.

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Market Not Excited by EU Summit

WTI oil futures open Friday’s trading session back near $97 a barrel as stock markets and oil prices both sold off late yesterday on growing doubts that European leaders can forge a credible borrowing scheme to tackle the euro zone’s debt crisis at an EU summit in Brussels.

Latest WTI Oil Price

US Light crude oil futures for January 2012 delivery was trading at $97.69 a barrel, 07.17 GMT this morning in electronic trading on the NYMEX.

The US oil contract closed off Thursday’s trading session at $97.97 a barrel, or 2.6 percent lower on the day.

EU Summit Failure

European Union leaders failed to get all of the bloc’s 27 members to back a change in the EU treaty to tighten their fiscal coordination as a decisive summit in Brussels ended its first day in the early hours Friday.

Speaking after long talks in Brussels, French leader Nicolas Sarkozy said the 17 eurozone states and other EU members would work on a separate pact instead.

The UK and Hungary will play no part in a new inter governmental treaty, while Sweden and the Czech Republic will consult their parliaments before making a decision.

The EU has struggled to unite to stem a 2 year old spiral of debt that started in Greece, has plunged the eurozone into crisis, and now threatens to send the global economy back into recession.

Even after Friday’s long-awaited deal, watched by governments and markets worldwide, the European leaders have huge hurdles still ahead.

They are meeting again later Friday to work out what exactly their new treaty will contain and how violators of its strict budget rules will be policed. They want it written by March.

“The situation in Europe swings between optimism and pessimism every single day. Lately, the market has built in a lot of optimism and I’m afraid of a letdown.” said Tom Bentz, director at BNP Paribas Prime Brokerage, New York.

In Asia, stock markets fell this morning, with Japan down 1.6 percent, Australia losing 1.4 percent and South Korea falling 1.9 percent.

Get ready for another possible sell off in oil, like all global markets, crude oil prices have been gripped by concerns in recent months that the crisis in European could trigger a global economic slowdown.

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WTI oil price back to $97 as markets sell off on EU summit failure

Financial markets steadied although the S&P announced to have put long-term ratings of the EFSF on negative watch, signaling the AAA rating of the fund could be lowered by one or two notches. The move, together with the previous warning that ratings of 15 countries in the Eurozone would be put on negative watch, is expected to push EU leaders to devise more creditable measures to contain the sovereign debt crisis.

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Market Steadies Although S&P Put EFSF on Negative Watch

The decline in oil prices eased in European session but the near-term outlook remained fragile due to the uncertainty in European debt problems. Meanwhile, BP warned that high oil prices would worsen global economic slowdown. On the macro front, Eurozone’s GDP expanded +0.2% q/q in 3Q11, unchanged from the preliminary reading.

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BP Warns of Growth Outlook as Oil Stays above 100

WTI oil futures open the week’s trading session pushing close to $102 a barrel as stock markets in Asia and Europe open higher, however it’s all eyes on the debt situation that clouds Europe and this week could turn out to be volatile for traders and investors.

Latest WTI Oil Price

US Light crude oil futures for January 2012 delivery was trading at $101.68 a barrel, 08.54 GMT this morning in electronic trading on the NYMEX.

The gains for the US oil contract extend the positive finish for WTI oil on Friday, notching up a weekly rise of over 4 percent.

Stock Markets Rally

Asian and European stock markets opened higher today, as investors hoped for progress in curbing Europe’s debt crisis in what could be a crucial week for the troubled region.

Hong Kong’s Hang Seng Index finished 0.7 percent higher, Japan’s Nikkei Stock Average rose 0.6 percent, while Australia’s S&P/ASX 200 rose 0.8 percent.

Meanwhile, Europe’s main stock markets advanced at the start of trading, with investors reassured by Italian austerity measures at the start of a critical week for the euro as investor’s hoped for more progress on Europe’s crisis ahead of a meeting later in the day between Angela Merkel and Nicolas Sarkozy.

“The start of a key week for Europe begins today with Sarkozy and Merkel meeting in Paris for talks on how the idea of a fiscal union might work in principle. Talk of fiscal union is one thing, being able to deliver even a framework for it is another.” said CMC Markets analyst Michael Hewson.

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WTI crude oil trades near $102, follows global stock markets higher

Brent crude oil futures open Monday’s trading session back in a bullish mode and pushing near $111 a barrel following the latest Iranian comments that the global price of crude oil would more than double if sanctions were imposed to block oil exports from Iran.

Latest Brent Oil Price

In London, Brent crude oil futures for January 2012 delivery was trading at $110.71 a barrel, 08.20 GMT this morning on the ICE Futures Exchange, after hitting $111 earlier in today’s trading session.

Oil Price at $250 a Barrel?

Iran’s foreign ministry spokesperson Ramin Mehmanparast told the local newspaper Sharq on Sunday: “As soon as such an issue is raised seriously the oil price would soar to above $250 a barrel.”

But oil analysts told Gulf News last night that Iran’s predictions seemed exaggerated.

“In the unlikely situation that oil exports were cut off then I still don’t buy the argument that oil prices would double. Saudi Arabia would step in and increase production to cover for that. In theory, they could make up the entire loss of Iran-ian exports.” said Robin Mills, an analyst at Manaar Energy Consulting.

European Oil Ban & Findings

The European Union on Thursday expanded a sanctions blacklist against Iranian firms and individuals and warned it was considering extra measures against Iran’s financial and oil sectors.

According to Fitch Ratings, a potential European Union ban on buying Iranian oil would be likely to have a much smaller negative impact on European oil companies than the recent Libyan crisis because exposure to Iran is almost exclusively through refining operations, rather than production.

“Oil production in Iran is dominated by the National Iranian Oil Company and the involvement of European oil companies in upstream activities is negligible. Any ban on Iranian oil imports, therefore, wouldn’t result in the same loss of cash-flow from production that occurred when facilities were shut down in Libya.” said Simon Kennedy, Director at Fitch Wire.

The oil market is being influenced by the rising tensions over Iran together with the economic situation in America and Europe.

Currently China, the European Union, India, Japan, South Korea and Turkey are the main customers for Iran’s oil exports.

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Brent oil futures remain bullish, near $111 on latest Iranian price comments