Brent Crude oil futures falls to $109.13 per barrel with high trading volume

Posted By: Religare
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Brent Crude oil futures falls to $109.13 per barrel
Brent crude oil futures settled at $109.13 per barrel and US crude futures settled down $2.62 at $97.18 per barrel, in the previous week. US crude ended down $16.75 for the week, the biggest weekly drop since the contract began trading in 1983 as traders cut their long positions.

Selling pressure on oil and other commodities increased as investors are skeptical about the demand in future amidst deteriorating economic conditions in Greece, death of Osama bin Laden and the impact of higher commodity costs on consumer nation economies to the monetary policy in major economies.

With the fall in oil prices in the previous week, money managers had cut their net long position in crude as revealed by the data from the US Commodity Futures Trading Commission which showed the speculator group reduced its net-long US crude futures and options positions by 7294 to 293,823 for the week to 3 May.

Commenting on the movement of oil prices, Goldman Sachs analysts said, "It is important to emphasize that even as oil prices are pulling back from their recent highs, we expect them to return to or surpass the recent highs by next year," and also added, "We continue to believe that the oil supply-demand fundamentals will tighten further over the course of this year, and likely reach critically tight levels by early next year should Libyan oil supplies remain off the market."

Read more about: crude, oil and gas
Story first published: Monday, May 9, 2011, 12:30 [IST]
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