Crude steady after Monday's plunge

21/04/2009

Following a day of heavy losses yesterday (April 20th), crude oil futures have stabilised in electronic trading on the New York Mercantile Exchange this morning.

By 05:22 Eastern Time, the headline crude contract was trading at an even $46 (£31.52) a barrel, up 12 cents on its closing price yesterday.

Reuters reports that the losses seen yesterday have been stemmed ahead of further data from the US, which is expected to show that stockpiles of crude, heating oil and other distillates such as DERV and gasoline rose for the eighth consecutive week.

If the data, due to be published tomorrow by the Energy Information Administration, does show a rise, investors are likely to take it as a cue to sell again prospects for demand remain weak.

"Oil fundamentals are not tight enough to carry crude above $55 a barrel and as soon as the combined support of strong equities and weak dollar goes missing then crude oil starts to move back," said Petromatrix analyst Olivier Jakob.