Despite a surprise drawdown in domestic crude stocks reported today, U.S. crude oil futures fell once more on the New York Mercantile Exchange Wednesday, pressured by oil traders' increasingly bearish outlook regarding the market's underlying fundamentals, as well as concerns about the global economy's recovery. Recording a negative movement on the NYMEX for the sixth consecutive session, the price of light, sweet crude oil closed nearly $2 less than its previous settlement to $70.67 a barrel. Additionally, natural gas spot prices at the Henry Hub reversed to just under the $5-threshold to settle at $4.898 per thousand cubic feet.
"We have broken out to the downside of this $75-$80 range in the crude oil market that had been holding since the middle of October," noted Bill O'Grady, the chief markets strategist at St.Louis based Confluence Investment Management LLC. "We fell out of it yesterday and accelerated today on government data that wasn't really all that bearish, you had a bullish crude number, but the product numbers were not very strong." Interestingly, the dollar's three day advance collapsed against the euro on Wednesday, which did little to prop up energy prices. Typically, a weaker greenback loses its safe haven appeal, spurring traders toward cheaper dollar denominated commodities.....Read the entire article.
Crude Oil - The New World Currency
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