Oil Prices Continue to Recover
The current oil price moved a little closer to $94 per barrel, maintaining its recovery from its sharp decline in the past week.
On the NYMEX, the U.S. benchmark crude for delivery in May was 17 cents higher to $93.53 per barrel. The contract gained 66 cents to settle at $93.36 per barrel during the previous trading day.
In the early parts of the past week, the crude oil price per barrel traded higher than $97 on the NYMEX. However, it eventually declined by more than 5 percent because of the weaker monthly employment report in the U.S. and figures showing crude oil inventories are at their peak level since 1990.
Clearly, several market players are starting to see the lower prices after the significant slide last week as an opportunity to purchase, according to analysts. Nevertheless, the possibility for a significant recovery in prices is limited.
Commerzbank noted a sharp decline in the inflation rate of China as supportive of the price of oil. The lower rate of inflation opens up the range for stimulus measures in case these are needed by Beijing’s new government leadership.
Bullish quarter one earnings from American aluminum producer Alcoa, on stronger demand from the manufacturing of cars and airplanes, also factored in the optimistic mood and aided the increasing prices of crude, according to a report of London’s Sucden Financial Research.
Moreover, investors will be observing new information on U.S. inventories of crude and refined commodities.
Data for the week that ended on the 5th of April is anticipated to show an increase of 1.4 million barrels in the inventories of crude oil and a stable supply of gasoline stocks, amounting to 1.8 million barrels, according to a poll of analysts.
The crude supply report will be released by the American Petroleum Institute later today, while that of the Energy Information Administration will be available on Wednesday.