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Oil Rallies on Supply Concerns & Fed Speculations

August 16, 2013 at 20:53 by Vladimir Vyun

Crude oil rallied today as political tensions in Egypt led to concerns about supply. The political conflict in the Middle Eastern country is intensifying and death toll is growing as supporters of the ousted president Mohamed Mursi clash with military forces. Egypt controls the Suez Canal, through which the huge amount of oil shipments come, meaning that the problems in the country may disrupt significant portion of global supply. Meanwhile, companies evacuate workers from oil platforms in the Gulf of Mexico due to threat of a storm, adding to supply concerns.

Oil also gained on speculations that the current economic conditions in the United States do not warrant smaller stimulus. The recent string of negative macroeconomic data eased the pressure on the Federal Reserve to scale back its asset purchases. Such talks were supportive for the commodities.

September futures for delivery of WTI crude oil rallied $0.46 (0.43 percent) to $107.79 per barrel as of 21:48 GMT on NYMEX today. October contract for Brent crude advanced $1 (0.91 percent) to $110.6 per barrel on ICE.

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

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