Commodity Daily News

Crude Prices Decline but Remain within Recent Ranges

While volatility has increased this month given the sharp declines at the start of May, spot crude oil prices continue to consolidate over the past two weeks with a bias to the downside as the European debt crisis reemerges. Spot crude oil prices are trading lower in the Asian session at $98.40 from an opening day price of $99.92.

Bias remains the downside as flair up in the European debt crisis threatens to weigh on global economic growth and investor sentiment. S&P's move this weekend to lower Italy's credit rating to negative from stable did little to boost traders' confidence in the European economy. The war of words between ECB officials and Greek leaders has also hurt sentiment for the crude oil bulls.

Until a catalyst emerges in the crude oil markets or a resolution is finally reached in the European debt crisis, crude oil prices may continue to slide. Initial support for spot crude oil is found at $94.70. A breach here could trigger declines to $93.00. Resistance comes in at $101.40 followed by $104.70.