Oil prices started the week with very sharp falls over the free fall in the major stock markets; the falls were probably stimulated by the news of the downgrade in US’s credit rating; this news came after the House of Representative approved on August 2nd to raise the US debt ceiling. Despite the shaky start, oil prices bounce back mainly during the second half of the week and eventually finished the week above its initial starting point. By the end of the week, Brent inclined by 4.15%, and WTI rose by 5.06%, resulting in the spread between Brent and WTI reaching $21.96/b on Friday.
Let’s review the changes during last week (August 8th to August 12th) of oil prices, and present a summary of the recent EIA oil report:
WTI inclined during last week by 5.06%; on the other hand, its weekly average price fell by 8.74% as it reached $82.92 per barrel, compared with last week’s $90.85 per barrel. The average daily per cent change of oil price (WTI) was -0.27%.
Brent also inclined by 4.15% during the week, but the average price fell by 6.42% compared with previous week’s average.
The difference between the Brent and WTI moderately inclined during the week and averaged at $22.50; it finished the week at $21.96.
The high gap between Brent and WTI continues to suggest that the European oil market is still tighter than in the U.S. oil market.
Oil Stockpiles –highlights:
According to the recent EIA report of the US oil market, for the week ending on August 5th, U.S. oil stockpiles sharply declined by 10.73 million barrels to 1,796 million barrels.
For further reading: Oil Prices – Daily Outlook August 12
Lior Cohen, M.A. commodities analyst and blogger at Trading NRG.