Oil Retreats from Pseudo-Relief Rally
A day after posting impressive gains in 3-percent territory, the WTI and Brent oil benchmark prices retreated a bit Thursday.
“It was kind of not the most exciting day of the year, that’s for sure,” Bob Yawger, director of the Futures Division with Mizuho Americas, told Rigzone. “You could also make the argument that today was a bit of a pullback after a 3-percent whopper to the upside. That is definitely a possibility.”
The October WTI futures price fell three cents to settle at $67.83 a barrel after trading within a range from $67.32 to $68.12. The Brent benchmark for October declined by a nickel to settle at $74.73.
Describing Wednesday’s bullish oil markets performance as a “pseudo-relief rally” given the lack of bearish sentiment in the Energy Information Administration’s latest inventories report, Yawger noted that the “surprise factor” regarding Cushing stockpiles appears to have waned this week compared to last.
“Backwardation in the WTI lost a little bit of value but I think the general trend here is a switch from contango to backwardation in Brent because of the surge in storage,” added Yawger. “Generally speaking, the whole day could be characterized as a reverse correlation to the dollar market.”
For natural gas, the September Henry Hub price picked up just under a penny to settle at $2.96. The price of a gallon of reformulated gasoline edged slightly downward to end the day at $2.06.
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