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Oil Drops After IEA Report, Natural Gas Rises

September 13, 2016 at 16:21 by Vladimir Vyun

Futures for crude oil dropped today after the release of a bearish report from the International Energy Agency. The agency said that “global oil demand growth is slowing at a faster pace than initially predicted.” The IEA revised its forecast for global demand growth to 1.3 million barrels per day – a downgrade of 0.1 million from the previous forecast. Furthermore, world’s consumption growth is expected to slow to 1.2 mb/d in 2017. While supply from producers from outside of the Organization of Petroleum Exporting Countries fell, the drop was offset by OPEC production that was near record highs. Futures for delivery of WTI crude oil in October dropped 2.89% to $44.95 per barrel as of 16:03 GMT on NYMEX today. November Brent crude declined 2.38% to $47.17 per barrel on ICE.

Meanwhile, prices for natural gas bounced after falling earlier today, hovering near the two-month high. The commodity gained due to forecasts of above-norm temperatures in the United States that should maintain need for air conditioning that result in higher consumption of electricity. That, in turn, means higher demand for the commodity from gas-fueled power plants. Now, traders wait for tomorrow’s supply report from Energy Information Administration. Futures for delivery of natural gas in October went up 0.14% to $2.92 per million British thermal units on NYMEX today.

If you have any questions and comments on the commodities today, use the form below to reply.

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