Oil Prices Could Decline if Middle East Tensions Wane (USO) (OIL) (BNO)
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Oil prices in the U.S. are moving higher in early trading on Thursday. Early in the week, tensions in the Middle East drove WTI prices back above $92 per barrel and Brent prices above $115 per barrel.
Today's EIA data showed a build of 1.7 million barrels compared to an expected build of 1.5 million barrel gain. API data on Tuesday showed a build of 1.65 million barrels, leading many to conclude that the EIA data would be reported in line.
Besides inventories, the more pressing issue for oil at the moment is tensions in the Middle East. Recent reports say Turkish warplanes forced a passenger jet flying from Moscow to Damascus to land in Turkey so that the cargo could be inspected. The event has heightened concerns about the growing rift between the two states.
While the tensions are pushing prices up in the short term, traders say those gains could quickly evaporate if temperatures cool in the region. Recent economic data out of China suggests growth in the country is slowing more rapidly than had been anticipated, leading some to conclude that global markets for oil will remain well supplied.
United States Oil ETF (NYSE: USO) is higher by 1.3 percent mid-day on Thursday. iPath S&P GSCI Crude Oil TR Index ETN (NYSE: OIL) is higher by a similar amount.
United States Brent Oil ETF (NYSE: BNO) is higher by 1.3 percent.
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Today's EIA data showed a build of 1.7 million barrels compared to an expected build of 1.5 million barrel gain. API data on Tuesday showed a build of 1.65 million barrels, leading many to conclude that the EIA data would be reported in line.
Besides inventories, the more pressing issue for oil at the moment is tensions in the Middle East. Recent reports say Turkish warplanes forced a passenger jet flying from Moscow to Damascus to land in Turkey so that the cargo could be inspected. The event has heightened concerns about the growing rift between the two states.
While the tensions are pushing prices up in the short term, traders say those gains could quickly evaporate if temperatures cool in the region. Recent economic data out of China suggests growth in the country is slowing more rapidly than had been anticipated, leading some to conclude that global markets for oil will remain well supplied.
United States Oil ETF (NYSE: USO) is higher by 1.3 percent mid-day on Thursday. iPath S&P GSCI Crude Oil TR Index ETN (NYSE: OIL) is higher by a similar amount.
United States Brent Oil ETF (NYSE: BNO) is higher by 1.3 percent.
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