Thursday, December 24, 2009

Crude Stays Strong Ahead of Holiday But Yet to Confirm Correction is Over

Despite thin trading ahead of long holiday, crude oil price's near term outlook remains strong. Currently trading at 77.2, the February contract is hovering around the highest level in 3 weeks. After plummeting to as low as 68.59 on December 14, the black gold has rebounded steadily as inventory levels from developed economies declined, showing signs of demand recovery. However, we are yet to confirm if crude oil has resumed the rise from 33.2 (January 2009) until price can trade sustainably above 80. On monthly basis, December will be a volatile month but actual gain or loss will be minimal.

Natural gas soars for the third consecutive day and has gained +1.4% so far this week. The market sentiment has turned after gas inventory dropped in the past 2 weeks. Later today, the US Energy Department will probably report that gas storage declined -171 bcf to 3395 bcf in the week ended December 18.....Read the entire article.

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