Future unclear for global oil investments
Crude oil futures edged higher for the second straight day in New York amid rising investor concerns that the tension surrounding the Middle East will continue to cripple supply efforts from the region. Reports from Europe announcing a new round of austerity and bailout efforts also bolstered oil investments.
West Texas Intermediate crude oil, the recognized U.S. benchmark gained more than 0.8% on the commodity index charts. The increase comes high on the heels of a warning issued by Iran’s officials stating that another round of sanctions against the oil-rich state will cause a sharp surge in crude prices that the fragile state of the global economy will not sustain.
Global oil investments also saw some support from the debt-addled euro zone, where an upcoming meeting between U.N. leaders and the U.S. Treasury Secretary Tim Geithner has infused new hope into the traders of the fuel.
Some economists have however repeatedly stated that the recent upturns in crude oil futures are strictly temporary and that investors should remain wary. Though prices seem poised onto an upward trajectory, the positive turns are coming from the escalating tensions between Iran and the West, and not from an actual sustained growth in demand. Unless a more permanent factor begins affecting the sector, crude oil will likely fall back into the low $90’s in the near future.
WTI futures for delivery in January rose 77 cents to $101.73 per barrel in electronic trading on the New York Mercantile Exchange. The American contract is up 13% for the year.
Brent crude oil prices for January settlement gained 35 cents and settled at $110.29 per barrel. Oil investments in the European benchmark commodity oil have surged over the past few days on renewed confidence in strong economic austerity displayed by some of the more affected regions of the euro zone.