Crude oil prices on the rise over the weekend – the Irish connection – news for 22nd November

The global tension around Ireland heats up the scene around major energy commodities. Yahoo repots us about crude oil prices reaching 82 USD/ Barrel, in Asia stock markets, and according to Bloomberg the prices of Nymex Crude Oil Future prices is at 82.62 USD / barrel as of 6.04AM GMT. Further, the prices of Dated Brent Spot prices is currently at 84.62 62 USD / barrel as of 6.15AM GMT.

This rise is also true for the Natural Gas prices as the Nymex Henry Hub Future is traded at 4.18 USD / MMBtu as of 6.05AM GMT.

These figures show that the macroeconomic news could play a significant role throughout the week vis-à-vis the commodities prices; on the one hand, China takes steps towards slowing down its economy. These steps include, among other: China ordering banks to raise their monetary reserves, i.e. handing out less loans which could act to fight China’s up growing inflation rate. This step could consequently have an adverse effect on the crude oil prices, as China is one of the largest consumers of energy.

On the other hand, there is the news of Ireland’s bailout program which could be responsible for this weekend rise in the prices of crude oil and natural gas. How does the news on Ireland being handed huge loans by the European Union could affect the energy prices? Some speculate that this move will weaken the dollar against the Euro (in Bloomberg news) which will consequently raise energy prices.

I think the reason for this connection between this news item and crude oil prices increasing over the weekend could be due to investors considering raising their ante in commodities such as crude oil as this bailout will weaken the European union and as a result investment opportunity in its economy.

For one thing is sure, as the week will progress we will see if there is any trend between any of the news listed above and the changes in energy prices.

Have a good trading week!

Recommended Reading:

There is a nice article on which claims that one of the main reasons for the high price we pay for oil and natural gas is a rise in drilling cost.