Crude Futures Trading Lower Amid Economic Concerns

Strategic Insights -

Crude oil futures are trading lower on Tuesday, containing concerns about economic growth. Despite a push higher on Monday, equities markets are expected to open lower, and housing data has shown a drop in new construction. This has led to concerns about future energy demand, causing crude prices to remain stuck in a narrow range between $70 and $80 a barrel. Analysts are looking ahead to data on oil supply and demand, with inventory statistics expected to show a drop in crude stockpiles and a rise in gasoline inventories.

Key Takeaways:

  • Crude futures are trading 0.7% lower at $76 a barrel on the New York Mercantile Exchange, with Brent crude trading 60 cents lower at $75.02 a barrel on the ICE futures exchange.
  • The Commerce Department reported a 5.0% drop in housing starts, with new-home sales collapsing by 33% in May due to the end of a government tax credit for first-time buyers.
  • Oil traders are looking to equities and economic data for direction, with conflicting earnings reports and indicators leaving crude prices stuck in a narrow range.
  • Analysts at JBC Energy note that oil markets are still dominated by concerns about the economic state, with oil fundamentals coming second.
  • The American Petroleum Institute is expected to publish its weekly U.S. inventory statistics, showing a 1 million barrel drop in crude stockpiles, and the U.S. Department of Energy is expected to show a 1.1 million-barrel drop in crude oil inventories.
  • Gasoline inventories are expected to rise by 1 million barrels, and stocks of distillate are expected to rise by 1.5 million barrels.

Statistics:

  • Crude futures are trading 0.7% lower at $76 a barrel.
  • Brent crude is trading 60 cents lower at $75.02 a barrel.
  • The Commerce Department reported a 5.0% drop in housing starts.
  • New-home sales collapsed by 33% in May.
  • Oil traders are looking to equities and economic data for direction.
  • Conflicting earnings reports and indicators have left crude prices stuck in a narrow range of $70 to $80 a barrel.
  • The American Petroleum Institute is expected to publish a 1 million barrel drop in crude stockpiles.
  • The U.S. Department of Energy is expected to show a 1.1 million-barrel drop in crude oil inventories.
  • Gasoline inventories are expected to rise by 1 million barrels.
  • Stocks of distillate are expected to rise by 1.5 million barrels.

Sources:

  • Dow Jones Commodities News via Comtex
  • Matt Zeman of LaSalle Futures Group
  • Analysts at JBC Energy
  • Jerry A. DiColo, Dow Jones Newswires
  • Dow Jones Newswires