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Crude Oil Prices Decline Once Again After Inventory Data

June 28, 2017
By Daisy Joseph
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The oil prices have been declining all over the world due to the increased output. To curb the supply of oil in the market, OPEC has asked the oil producing members to reduce the production. All the OPEC members had agreed to cut down the oil production. However, US Shale oil production continued to rise, negating the efforts of OPEC.

After reaching a six week low point, crude oil prices increased slightly in the past week. The weekly API inventory data now shows that the oil prices will take a declining path once again. The key support will be in the range of 43.79-44.10. The official EIA data may point to the need for increased pressure for selling oil. About 1.13 million barrel outflow is expected to be reported.

In other news, gold prices face a decline following the trend of Treasury bond yields as the value of USD rose in the market. The demand for non-interest assets such as metals has declined because of the increased interest in US dollar. Test support for gold is in the range of 1241.20 – 45.59.

Bill Dudley, president of the Fed shows continued interest in increasing interest rates following the FOMC committee meetings. The hawkish shift in the market is triggered by his positive opinion of the expansion of the US economy. When the policymakers continue to emphasize on economic growth after the weekly policy meetings, it could help the US dollar to gain more in the market.