Brent Higher As Taper Worries Ease
Brent crude oil looked poised to end the week on a high note on Friday morning, trading at $108.58 at 7:30 GMT. The commodity was aided by supply tension in Northern Africa as well as easing taper worries in the US.
CNBC reported that the International Energy Agency issued a report which stated that although markets are currently well supplied, production problems in both Libya and Iraq could become a problem. At the moment, oil demand is well met; however as countries in the northern hemisphere head into winter, demand is likely to increase over the next few months.
The report also showed that US crude inventories were up by 2.6 million barrels last week. The figure far surpassed the 1 million barrel increase that analysts had been predicting for the world's largest oil consumer. The inventory data put pressure on WTI prices and caused the US contracts to fall to their lowest level since the beginning of June.
Comments from Federal Reserve Vice Chairwoman Janet Yellen also supported Brent prices as she went before the Senate for a hearing to confirm her nomination as the next Federal Reserve Chairman. Yellen defended the Fed's easy money policies saying that the bank still had work to do and that the US was not yet ready to stand on its own.
The comments prompted many to revise their taper estimates later, with most settling on March as the most likely month for the bank to start cutting down on its stimulus spending.
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