Commodity Daily News

Crude Oil Drops Below $88.00 a Barrel

Crude oil saw a relatively calm trading session during the past week, yet by Friday crude dropped about 200 pips and reached as low as $87.10 a barrel. During most of the week crude oil was traded between $87.60-90.70 a barrel.

Crude oil fell on Friday after China raised bank reserve requirements to fight inflation. Chinese inflation rose to a 28-mont high of 5.1% in November, from 4.4% in October. In addition, OPEC has agreed to keep production targets unchanged, forecasting demand growth will slow.

Looking ahead to this week, traders are advised to follow the leading economic publications from the U.S. and the euro-zone, as these are likely to have a significant impact on crude oil trading. Traders should also follow the U.S. Crude Oil Inventories report on Wednesday, as this release usually has an instant impact on the market.