Crude Oil Closes Choppy Trading Slightly Lower
December 11, 2007 – 4:29 amCrude oil closed lower on Monday after another volatile day of trading. Light sweet crude for January delivery moved at $87.86, down 42 cents on the session. Crude climbed as high as $89.80, but began to decline in the mid-morning before leveling off. Traders looked ahead to Tuesday’s FOMC decision and Wednesday’s inventory data, and also continued to mull last week’s OPEC decision.
Oil dropped 43 cents amid extremely choppy trading last week. Investors continued to consider OPEC’s decision to leave production unchanged at its meeting in Abu Dhabi when many experts expected a rise of up to 1 million barrels a day. Prices had been dropping for about 10 days as investors predicted a production increase. Because of high prices, however, the council will meet again in February at a special meeting.
Traders are looking ahead to Wednesday’s inventory report. Last week’s data from the Department of Energy showed a drop of nearly 8 million barrels. Analysts had been expecting a much more modest decrease of about 800,000 barrels. However, figures in Cushing, Okla, moved higher.
Investors are looking ahead to the Federal Open Market Committee meeting, which is planned for Tuesday. Most experts expect to see an interest rate cut for the third straight meeting. The question for many has become whether the Fed will elect to slash rates by either 25 or 50 basis points.
On the economic front on Monday, data revealed that in October, pending home sales rose 0.6 percent, compared to a 0.2 percent increase in September. Analysts had expected a one percent decrease. Other economic news is also expected this week. Wednesday, export and import prices will be made public, along with the U.S. trade balance. On Thursday, data on Retail Sales, business inventories, and the Producer Price index will be released. Friday investors will be given access to the consumer price index, and industrial production.
Source: RTTNews.com
