Oil Price Rose on Tuesday Ahead of US Inventory Data

January 9, 2018 Share Print 0

Oil prices edged higher on Tuesday, with U.S. crude touching its highest since December 2014, supported by OPEC-led production cuts and expectations that U.S. crude inventories have dropped for an eighth week.

The Organization of the Petroleum Exporting Countries and allies including Russia are keeping supply limits in place in 2018, a second year of restraint, to reduce a price-denting glut of oil held in inventories.

U.S. West Texas Intermediate crude (WTI) rose 95 cents, or 1.5 percent, to $62.68 a barrel by 11:55 a.m. EST (1655 GMT) after touching its highest since December 2014 at $62.80.

Brent crude was up 81 cents, or 1.2 percent, at $68.59 per barrel after hitting a session high of $68.74, its highest since May 2015.

“You’re so long this market at this point, you could certainly get more interest at these levels,” said Rob Haworth, senior investment strategist at U.S. Bank Wealth Management.

“This is a little more confirmation of what speculators have been looking for and after tomorrow’s (U.S. government inventory) report, we’ll see if they look to do some profit taking.”

OPEC is cutting output by even more than it promised [OPEC/O] and the restraint is reducing oil stocks globally, a trend most visible in the United States, the world’s largest and most transparent oil market.

via Reuters

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Alfonso Esparza

Senior Currency Analyst at Market Pulse

Alfonso Esparza specializes in macro forex strategies for North American and major currency pairs. Upon joining OANDA in 2007, Alfonso Esparza established the MarketPulseFX blog and he has since written extensively about central banks and global economic and political trends. Alfonso has also worked as a professional currency trader focused on North America and emerging markets. He has been published by The MarketWatch, Reuters, the Wall Street Journal and The Globe and Mail, and he also appears regularly as a guest commentator on networks including Bloomberg and BNN. He holds a finance degree from the Monterrey Institute of Technology and Higher Education (ITESM) and an MBA with a specialization on financial engineering and marketing from the University of Toronto.