Rolling in a new front-month contract for April delivery, NYMEX crude oil futures settled on the downside Tuesday after rallying for five consecutive sessions, punctuated by a break above an $80-threshold.
Shedding $1.45 from yesterday's contract price, April crude futures ultimately settled to $78.86 at the close of today's session on the New York Mercantile Exchange. On Monday, with the March contract heading into expiry, oil prices soared above $80 a barrel.
Today, the price per barrel of light, sweet crude oil was pressured by a stronger greenback, as well as a discouraging report out of the Conference Board indicating that U.S. consumer confidence fell to a 10-month low in February.
March natural gas spot prices at the Henry Hub also traded lower on Tuesday, slipping below the higher end of its current trading range above $5 to $4.78 Mcf.
"The market's five-day rally came to an end today," noted Gene McGillian, analyst at Tradition Energy in Stamford, Connecticut. "I think that, besides the fact that the market rallied five consecutive days, it was a little overdone from a bullish perspective."
McGillian pointed to economic data out of the EU and the consumer mood report as factors weighing on both the equities and commodities markets, which continue to "demonstrate an attachment to broader financial issues."
"The battle we've been fighting for the past half-year in the oil markets is still being waged -- the fundamentals really aren't strong enough to support a push too far above $80," McGillian added.
Financial heavyweight Goldman Sachs sees oil prices continuing to rise, however, in line with last week's rally. Citing the expectation of improved near-term fundamentals and the encouraging signals of a recovering economy, Goldman Sachs has reportedly tagged benchmark oil prices in a higher trading range between $85-$95 a barrel for 2010.
Tomorrow, oil markets will be eyeing technical data out of the American Petroleum Institute ahead of the EIA's weekly inventory report. According to a Reuters poll, analysts are anticipating a build in domestic crude oil and gasoline stocks and a decrease in distillate supplies for the week to Feb. 19.
Most Popular Articles
From the Career Center
Jobs that may interest you