After closing last week mixed, crude oil started this week on a weaker note. However, crude oil prices regained strength as the week progressed. On Friday, crude oil started the day higher but traded with weakness in the early hours.
Crude oil’s market sentiment was stable at the beginning of the week amid signs of global market rebalancing. Despite a rise in inventory levels reported by the U.S. Energy Information Administration this week, crude oil prices were stable amid the strong market sentiment. On Thursday, the prices rose amid comments from Saudi Arabia on supply cuts. Saudi Arabia’s Crown Prince Mohammed bin Salman commented on Thursday that Saudi Arabia is working with major crude oil producers to stabilize the oil market. His comments strengthened the market sentiment and pushed the prices higher. The market is expecting an extension of the supply cut agreement by OPEC at the producers’ meeting at the end of November. The market is looking forward to the release of Baker Hughes’s US oil rig count data at 1:00 PM EST today.
At 7:30 AM EST on October 27, the West Texas Intermediate crude oil futures contracts for December 2017 delivery were trading at $52.56 per barrel—a fall of ~0.15%. The Brent crude oil futures contracts for December 2017 delivery fell 0.19% and traded at $59.20 per barrel. The SPDR S&P Oil & Gas Exploration & Production ETF (XOP) closed at $32.42 after rising 0.53% on October 26.
Amid improved confidence about China’s economic growth, copper gained for four consecutive trading weeks and started this week on a stronger note. However, the market pulled back on Friday amid strength in the US dollar. The strong dollar weighs on dollar-denominated commodities like crude oil, copper, and gold.
Gold (GLD) and silver (SLW) are weak in the early hours on October 27. The rise in the dollar on October 16 amid the improved market sentiment in US markets weighed on gold prices. Platinum and palladium are also weak in the early hours on October 27.