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Crude Oil Hits a 12 Year Low on Today

Points to consider in this article:

  • Gold is still higher thanks to risk selling.
  • Heavy oil trading volume after an International Energy Agency Report.
  • Copper moved lower after rallying yesterday.

Let’s get started on some news you need to follow today.

US Crude oil prices hit a 12 year low in early Asian trade at $27.92 per barrel. This came on heavy volume caused by International Energy Agency (IEA) publication that the current oil glut will last the rest of the year. The report cited a mild winter, weak demand that continues to weaken from a five year high in the third quarter of 2015 to a one year low in Q1 this year. There is also the fact that global oil supplies will add another 285 million barrels despite lower levels from OPEC. Iran will likely contribute nearly 300K per day by then end of this current fiscal quarter (Q1).

Brent-WTI futures returned to positive territory today before closing flat near $30 per barrel. Right now, oil does not have the momentum to sustain upwards momentum.

Gold continued to hold a bit higher after a volatile selling of commodities and other risk assets. The yellow metal got a boost from the Bank of England (BoE) and Governor Mark Carney who is hesitant to hike up interest rates this year. Lower rates and unruly Forex manipulations have opened up gold to traders.

Copper prices have been battered up and down this week. Overnight the price of copper retreated from its correction higher. This was the biggest up move since January 11, 2016. Copper was affected by the soft Chinese GDP and a slowing investment trend into infrastructure by the world’ second largest economy. This is likely to depress not only copper prices but other metals as well.

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