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Crude drops on supply concerns, shrugs off U.S. data

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Investing.com -

Investing.com - Oil prices took a dive on Monday on fears crude supply far outweighs demand, which offset upbeat U.S. housing data.

In the New York Mercantile Exchange, West Texas Intermediate crude oil for delivery in October traded down 1.66% at $93.74 a barrel during U.S. trading. New York-traded oil futures hit a session low of $93.44 a barrel and a high of $95.09 a barrel.

The October contract settled up 1.32% at $95.32 a barrel on Friday.

Nymex oil futures were likely to find support at $93.43 a barrel, the low from Jan.21 , and resistance at $98.45 a barrel, the high from Aug. 8.

Ongoing concerns that the world is awash in crude battered oil prices on Monday, especially as tensions between Ukraine and Russia appeared to wane.

Russian and Ukraine foreign ministers held talks earlier and while no resolution to end the conflict emerged, the flow of humanitarian aid deliveries into Ukraine from Russia continued, which eased nerves in global markets.

Crude prices have spiked in recent sessions on fears the conflict will heat up and disrupt shipments out of Russia.

Upbeat U.S. data failed to seriously cushion's oil's slide on Monday.

The National Association of Home Builders/Wells Fargo Housing Market Index increased to 55.0 in August, a seven-month high, from 53.0 in July, beating estimates for a reading of 53.0.

A level above 50.0 indicates a favorable outlook on home sales and below indicates a negative outlook.

"As the employment picture brightens, builders are seeing a noticeable increase in the number of serious buyers entering the market," said NAHB Chairman Kevin Kelly.

Separately, on the ICE Futures Exchange in London, Brent oil futures for October delivery were down 2.05% and trading at US$101.41 a barrel, while the spread between the Brent and U.S. crude contracts stood at US$7.67 a barrel.

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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

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