Credit: Shutterstock photoFebruary crude oil prices turned sharply higher during the initial morning hours and climbed to a fresh three month high in the process. Some traders indicated that early strength in the market came from better than expected December trade data in China overnight, headlines that Saudi Arabia is cutting output and modest geopolitical headwinds. The Chinese data showed both import and export flow increasing at a much stronger than expected rate, and that offered more evidence that their economy was leaving last quarter's trough behind. Headlines earlier this morning pointed to a reduction in Saudi Arabian December oil production by nearly 5% on the month, as they contend with slack demand. The crude oil market showed a mixed reaction to yesterday's EIA inventory data that showed a slightly smaller than expected build of 1.314 million barrels. This left US crude supplies at 361.253 million barrels, which is the highest for this week since 1988. EIA crude stocks are 26.606 million barrels above year ago levels and 38.761 million barrels above the five year average. Crude oil imports for the week stood at 8.342 million barrels per day compared to 7.094 million barrels the previous week.
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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.