Oil prices finished yesterday with a mixed trend again as WTI rose and Brent slightly fell. Today, the core CPI of Canada will be published.
Here’s a short analysis and outlook of the oil market for today, July 22nd:
Oil prices – July 2011
On Thursday, July 21st oil price (WTI) rose by 0.78% to $98.91/b; during July WTI inclined by 3.79%.
Brent on the other hand fell 0.25% to $117.65/b; during July Brent rose by 5.32%.
The chart below shows WTI and Brent during May to July. It shows the changes in the trend of oil, and how the current state of these prices is “no trend” mode after they had risen very sharply at the beginning of July.
The premium of Brent over WTI started to fall in recent days as Brent oil declined while WTI spot oil price rose; on Thursday July 21st the premium reached $18.74/b – its lowest level since July 8th; during July this premium rose by 14.20%, mainly because Brent outperformed WTI during the first week of July.
USD/ oil prices – July update
Yesterday, EUR/USD exchange rate rose very sharply by 1.48%, this gain was probably related to the news of the Franco-German agreement on the Greece bailout. Furthermore, the AUD /USD rose by 0.84% and USD/CAD fell by 0.44%. The fall of the US dollar might be related, in part, to the concerns over the debt ceiling talks (see here for further elaboration on the debt ceiling talks).
This means the USD depreciated against major currencies primarily vs. the Euro. These shifts coincide with slow rise of oil prices; if this trend will continue it may further push up oil prices.
Oil price analysis:
Oil prices continue to slowly rise, but there is still no clear direction for oil prices and in the short term, they are likely to remain near $97-$100 for WTI and $117-$118 for Brent.
For further reading: Oil prices Monthly outlook –July 2011
Lior Cohen, M.A. commodities analyst and blogger at Trading NRG.