$100 per barrel in sight as crude rises again

US light crude oil today hit its highest price this year after factory orders rose.

US light crude oil futures for August delivery were up 1.63% at $99.62 per barrel by mid-afternoon in New York, after having traded as high as $99.87 earlier. This is the sixth time out of the last seven trading days oil prices have advanced.

News that US factory orders increased 2.1% in May, while April’s data was upwardly revised from 1.0% to 1.3%, backs up yesterday’s reports that indicated expansion in the manufacturing sector. Such growth would imply a robust demand outlook for oil.

Weekly petroleum inventory data from the US Energy Department will be released tomorrow. A Thomson-Reuters survey of analysts shows the consensus of expectation is for a large drop in crude oil stocks, with a decrease of 2.68 million barrels expected.

Such a large drawdown would point towards increasing demand, as refineries crank up their rate of output of crude distillates in time for the US Independence Day holiday. US domestic crude supplies have been very high by historical standards of late, with crude production surging on account of the shale boom.

The peak petroleum-consumption period between May and September, when many Americans take to the roads for their annual holidays, is helping to contend with this increasing supply. Strong demand in the US, which is the largest oil-consuming country in the world, is naturally supportive of the oil price.

This information has been prepared by IG, a trading name of IG Markets Limited. In addition to the disclaimer below, the material on this page does not contain a record of our trading prices, or an offer of, or solicitation for, a transaction in any financial instrument. IG accepts no responsibility for any use that may be made of these comments and for any consequences that result. No representation or warranty is given as to the accuracy or completeness of this information. Consequently any person acting on it does so entirely at their own risk. Any research provided does not have regard to the specific investment objectives, financial situation and needs of any specific person who may receive it. It has not been prepared in accordance with legal requirements designed to promote the independence of investment research and as such is considered to be a marketing communication. Although we are not specifically constrained from dealing ahead of our recommendations we do not seek to take advantage of them before they are provided to our clients. See full non-independent research disclaimer and quarterly summary.

CFD’s zijn complexe instrumenten en brengen vanwege het hefboomeffect een hoog risico mee van snel oplopende verliezen. 79% van de retailbeleggers lijdt verlies op de handel in CFD’s met deze aanbieder.
Het is belangrijk dat u goed begrijpt hoe CFD's werken en dat u nagaat of u zich het hoge risico op verlies kunt permitteren.
CFD’s zijn complexe instrumenten en brengen vanwege het hefboomeffect een hoog risico mee van snel oplopende verliezen.