Oil prices hit a two-month low today. As of 4 p.m. West Texas Intermediate was trading at $44.49 a barrel, down 2.05% on the day, and Brent benchmark crude was at $46.07, down 1.48%. The driver for the retreat in prices was worry over increasing supply.
The U.S. dollar is down for the third straight day and that has given oil prices a chance to recover after six straight declines. The dollar, as measured against the basket of currencies in the Bloomberg Dollar Spot Index, was down 0.42% today, as of 1:30 p.m. New York time Oil, on the other hand, has rallied today with the U.S. benchmark West Texas Intermediate up 2.75% to $47.48 a barrel
What had been up earlier this week was down today. U.S. stocks retreated with the Standard & Poor’s 500 stock index down 0.90% to move back below 2100 again. Emerging market stocks fell too with the iShares MSCI Emerging Markets ETF dropping 2.53%. Oil tumbled with U.S. benchmark West Texas Intermediate crude down 3.14% to $48.97 a barrel, below the closely watched $50 a barrel marker
This morning the U.S. Energy Information Administration reported that U.S. crude inventories fell by 1.37 million barrels for the week ended May 27. That was less than the 2.5 million barrel decline projected by energy analysts surveyed by Bloomberg. But at least the move was in the right direction–downward
Today, May 10, evidence of “firming” inflation in China led to a rally in industrial metals such as copper and other commodities; which is a complete turnaround from the weekend when a larger than expected decline in Chinese exports and imports led to Monday weakness in commodity prices.
After yesterday’s weaker than expected report on GDP growth, the Fed Funds futures market is giving odds of just 12% on a June interest rate increase. The odds of a June rate increase had been 21% after the Fed’s Wednesday meeting
Neither Alcoa nor aluminum set the direction of the market these days, but investors and traders looking for a sustainable turn in commodity demand and prices didn’t get anything to cheer about when the company announced first quarter earnings after the market closed yesterday, April 11.
