Profit Making Rally on Mideast Risk Eases U.S. Oil
On Wednesday, price of crude oil futures slid as investors went in for profits after the prices moved to its two-week highs in the preceding session mainly due to the rising geopolitical tension in the Middle East with Turkey bringing down a Russian warplane.
On Tuesday, Brent LCOc1 dropped four cents to $46.08 per barrel. It went up $1.29, settling at $46.12 per barrel after reaching a high of two-week, at $46.50.
West Texas Intermediate futures CLc1 dropped 11 cents to $42.76 per barrel. It finished the earlier session with a 2.7 percent up at $42.87, touching the highest since November11 at $43.46.
Referring to the growing geopolitical risk in oil-producing Middle East, Daniel Ang who is an investment analyst at Phillip Futures Pte Ltd said, “In Asian hours you are seeing some profit-taking or some consolidation ... With the price falling slightly, but bullish sentiment is continuing.”
On Tuesday, Turkey shot down a Russian warplane close to the border of Syria, as it said the jet violated its air space.
Vladimir Putin, the Russian President said the bringing down of the warplane may lead to “serious consequences” saying it was a stab in the back administered by “the accomplices of terrorists.”