Last month, oil prices rose strongly to record high levels, but so far in October, prices have falling for the first 2 days. Yesterday we saw a $1.42 drop in the precious crude, and that has continued to be the case in today’s action. At mid-day we are seeing prices down $1.02 to $79.22 after briefly heading under the $79 mark to hit an intra day low of $78.96.
Most of today’s sell off can be attributed to pure profit taking, which is to be expected after the strong run prices have taken over the past few weeks. We will get a better idea of whether or not this current two day sell off will endure tomorrow when the Energy Dept’s weekly inventory report is released. Analysts are expecting to see a drop of 400,000 barrels when the report comes out, and if we see a larger than expected fall in inventories you can be sure that prices will once again bounce above $80.
[Thanks to octal for the photo]
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