IV:Crude oil futures trade near 2-week low after Obama’s speech
Investing.com - Crude oil futures swung between small gains and losses during European morning hours on Wednesday, after President Barack Obama eased fears of any immediate military action in Syria.
On the New York Mercantile Exchange, light sweet crude futures for delivery in October traded at USD107.44 a barrel during European morning trade, up 0.05%.
New York-traded oil futures held in a range between USD106.58 a barrel, the daily low and a session high of USD107.50 a barrel. The October contract settled down 1.95% at USD107.39 a barrel on Tuesday.
Oil futures were likely to find support at USD105.86 a barrel, the low from September 2 and resistance at USD110.44 a barrel, the high from September 9.
In an address to the nation late Tuesday, President Obama said that he had asked Congress to postpone a vote on taking military action against Syria.
Instead, Obama said that he will explore a plan proposed by Russia for Syria to place its chemical weapons under international control.
Oil prices surged to a 27-month high of USD112.22 a barrel on August 28 amid indications the U.S. was close to taking military action against Bashar al-Assad’s government.
While Syria is not a major oil producer, investors fear that the two-year-old civil war could spill over to affect oil supplies in nearby countries.
Countries in the Middle East and North Africa were responsible for 36% of global oil production in 2012.
Oil traders now looked ahead to data from the U.S. government on oil and fuel supplies later in the day to gauge the strength of demand from the world’s largest oil consumer.
The report was expected to show that U.S. crude oil stockpiles fell by 1.5 million barrels last week, while gasoline inventories were forecast to decline by 1.25 million barrels.
After markets closed Tuesday, the American Petroleum Institute, an industry group, said that U.S. crude inventories fell by 2.9 million barrels last week, compared to expectations for a decline of 2 million barrels.
Elsewhere, on the ICE Futures Exchange, Brent oil futures for October delivery added 0.65% to trade at USD111.98 a barrel, with the spread between the Brent and crude contracts standing at USD4.54 a barrel.
London-traded Brent prices plunged 2.2% on Tuesday to hit USD110.59 a barrel, the lowest level since August 26.
