| News | Crude oil declines, the U.S. dollar advances |
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| Analysis | Crude oil declined during the day, extending the losses recorded in the past two sessions, where after OPEC group cut forecasts for oil demand, the strengthening dollar has forced more downside pressures on the black gold to trade lower, especially after investors have been trading with high caution today, awaiting applicable solutions from lawmakers in Europe. Crude oil futures for November settlement declined after the opening of $84.90 per barrel, and recorded the highest at $85.37 and the lowest at $83.14, and are hovering now around $83.56 per barrel. Europe remains the main focus in the market, as we can see European leaders are closely watched, awaiting any moves or steps to be taken in attempts to quell jitters and debt woes, with all of the attention is concentrated on the leaders’ summit on October 23. The EIA report showed us that the U.S. commercial crude oil inventories increased by 1.3 million barrels from the previous week. At 337.6 million barrels, U.S. crude oil inventories are in the upper limit of the average range for this time of year. Total motor gasoline inventories decreased by 4.1 million barrels last week and are in the upper limit of the average range. While that both finished gasoline inventories and blending components inventories decreased last week. Distillate fuel inventories decreased by 2.9 million barrels last week and are in the upper limit of the average range for this time of year. Due to the high level of uncertainty, we can commodities are volatile, especially when the U.S. dollar is the biggest winner, awaiting the Slovak parliament to approve the expanded powers of the European rescue fund, especially after the leader of the leftist opposition Smer party, Robert Fico, had reached an agreement with three parties in the coalition to approve the expansion plan by Friday. Moreover, the world’s largest economy released the weekly jobless claims, which came better than expectations at 404 thousands, while the U.S. trade deficit widened to $45.6 billions, yet better than expectations, adding more strength to low yielding currency to hold onto the gains recorded earlier, which in turn forces more downside pressures on commodities to decline today and in the coming period unless growth outlook improves. The U.S. dollar index (USDIX) advanced after starting the session at 77.00, to currently trade around 77.39 after reaching the highest at 77.42 and the lowest at 76.83. |
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