Oil climbed to nearly $97 a barrel on Wednesday due to a not
expected draw in U.S. crude stocks offset worries over a U.S. recession.
U.S. crude rose 65 cents at $96.98 a barrel by 11:05 a.m. EST. London Brent
crude traded 15 cents higher at $95.69.
"It was a shocking report. Crude oil stocks were down dramatically, partly
because of lower imports and higher refinery runs," said Peter Beutel,
president of Cameron Hanover. Many commodities have started the year
at record prices as investment funds try to diversify their portfolios to hedge
against equity markets crisis. Gold and platinum hit their historical peaks on Wednesday. Oil hit a record
high of $100.09 a barrel last week.
Equity markets have been very bearish, moving in the opposite direction,
concerned by the slowing U.S. economy. The U.S. stock market has had its
worst-ever five-day start to the year.
Oil prices on Friday drop down due to fears that the US economy may face a recession and low down the demand for oil.U.S. crude fall 85 cents to $92.86 a barrel while London Brent crude traded 97 cents down at $91.25 a barrel.
Plus, tha actual scenario in Nigeria is not making the situation any better. Nigeria is Africa's largest oil producer and a major oil supplier to the U.S. On Thursday, U.S. Federal Reserve Chairman Ben Bernanke stated that the central bank was ready to cut interest rates to help avoid a recession but oil prices did react despite the announcement.
Oil had been traded above $90 for almost a month and hit a record high of $100.09 a barrel on January 3, but began to fall on Wednesday after the release of data that showed a rise in U.S. fuel stocks and a further decline in crude supplies.
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