Fears of contagion from the Tunisia-Egypt uprisings, especially to the oil-rich countries, affected trading sentiment throughout the week. Successful popular uprisings in Tunisia and Egypt encouraged people in other countries _ Iran, Bahrain, Yemen and Libya among them _ to rally.
In addition, tension grew between Israel and Iran after the latter requested passage for two naval vessels through the Suez Canal to Syria, in a move that Israel called a provocation. Egypt approved Iran's request.
Crude prices gained further support from the lower-than-expected weekly rise in US crude inventories. The Energy Information Administration said commercial crude stockpiles grew only 860,000 barrels, lower than the forecast increase of 2.2 million.
Nonetheless, price gains were limited by weak economic data. US retail sales stalled due to harsh winter weather, while industrial production posted its first decline since June 2009, and January inflation grew the fastest in more than a year. Meanwhile, eurozone GDP in the last quarter of 2010 increased less than forecast due to contractions in Greece and Portugal.
The overheating economy in China remained a concern after core inflation jumped 2.6% year-on-year, the highest since at least 2002. Further tightening measures may result, affecting global recovery and energy demand. On Friday, the People's Bank of China raised its bank reserve requirement ratio by 50 basis points to 20% for large banks in a new move to curb lending and cool inflation.
Thaioil estimates trading this week in the range of $83-89 for WTI and $99-105 for ICE Brent, supported by continuing unrest in the Mideast. A wide Brent-WTI spread is expected as US inventories remain high despite recent bullish data. Priofit-taking from the recent price surge is also being monitored, as well as Opec's response to high oil prices at the International Energy Forum in Saudi Arabia tomorrow.
US economic reports this week include consumer confidence, new and existing home sales, durable goods orders, consumer sentiment, and GDP for the fourth quarter of 2010.
In Singapore, rallying Dubai crude prices pushed diesel close to $117, up nearly $2 from a week earlier, while gasoline surged more than $3 to close above $111 a barrel.
Better fundamentals also supported prices as incremental demand came from the Mideast for gasoline and from Indonesia and India for diesel. Tight supply is expected to continue into next month with the start of the refinery maintenance season in most regions of the world.
Looking forward, prices for both diesel and gasoline are expected to remain high, driven by strong crude costs and firm market fundamentals. Ongoing refinery turnarounds, which peak in March, and the upcoming plant-growing season will provide support to product prices in Singapore.Read More... For the latest updates PRESS CTR + D or visit Stock Market news Today
No comments:
Post a Comment