Oil Prices Waiting on First Move

Reuters Article

U.S. crude oil futures reached $101.80 a barrel on Friday in early Asian trade as the market watched for any supply disruption of oil and gas from Russia to Europe as tensions in Crimea intensified.

Obama urged Russian President Vladimir Putin on Thursday to accept the terms of a potential diplomatic solution to the Ukraine crisis in a phone call that lasted an hour.

The U.S. House of Representatives on Thursday overwhelmingly approved a bill backing $1 billion in loan guarantees for Ukraine, the first formal response by U.S. lawmakers to the worst crisis in U.S.-Russia relations since the Cold War.

My opinion: Oil prices are an underlying component to the world economy. Increases in crude causes global price increases. While we wait to see what actually unfolds between US and Russia, at least the rhetoric up to this point hasn’t been too ominous to drive oil up – yet. Luckily, all these event are occurring during record high inventories in crude oil on the Gulf Coast. So, as I see it, as long as nothing drastic happens during this standoff then oil prices for the US should remain level in the near term.


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