Current Oil Prices Shed $3 per Barrel
Current oil prices fell by over $3, with the U.S. benchmark at $92 per barrel on reports of higher Saudi Arabian and U.S. inventories, according to analysts.
In the NYMEX, the crude price per barrel of West Texas Intermediate (WTI) for October delivery decreased by $3.31 to end at $91.98. Meanwhile, in London, the crude price per barrel of Brent declined $3.84 to finish at $108.19.
At the start of the trading day, the two major crude blends were stronger as traders welcomed the news that the Bank of Japan joined the European Central Bank and the Federal Reserve in announcing additional fiscal easing measures, according to analyst Fawad Razaqzada of GFT Markets trading group.
But that was followed by a quick sell-off when reports came out that Saudi Arabia, as the biggest oil exporter in the world, was making plans to raise production to control current oil prices. The Kingdom’s view that crude oil prices are too high was revived following a statement in the Financial Times that the Arab country had been offering additional supplies to its customers.
Some anonymous sources have been reporting that the country is going to try to push down the crude oil prices. Those reports are considered by many to be somewhat reliable. Further, an unexpected rise in crude stocks in the weekly petroleum supplies report of the US government also sent the market a bearish sign.
Looking at the global crude market, it appears to have sufficient supply. Basing on the present supply and demand, current oil prices could not be justified after its drop of four dollars. It can be easily argued that the crude price per barrel should be in the range of $80 per barrel.