Despite Headlines Crude Oil Traders Remain Stoic (USO) (OIL)

November 21, 2012 11:01 AM EST
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United States Oil ETF (NYSE: USO) traded slightly higher on Wednesday, as traders digested crude inventories data that showed a drop of 1.47 million barrels compared to expectations for a gain of 1 million barrels. API data on Tuesday showed gains of 1.9 million barrels, so the negative print wasn't a complete surprise.

This week WTI and Brent crude trading has been tied to geopolitical tensions in the Middle East, with Israel and Hamas trading rocket fire, while outside parties attempt to broker peace.

Since news of the escalating tension broke, crude futures have tracked higher, but many were surprised by the somewhat muted reaction in oil markets, considering the region remains a tinderbox. This may point to ongoing concerns on the demand side, as oil markets remain well supplied despite sanction against Iran. On the other hand, traders may simply be desensitized to these type of headlines.

United States Oil (NYSE: USO) traded higher by 0.4 percent intraday on Wednesday. iPath S&P GSCI Crude Oil Total Return ETF (NYSE: OIL) was higher by a similar amount.

Brent futures traded at $111 per barrel and WTI traded just below $87.50.

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