Crude oil prices remain steady in early Tuesday trading

Crude oil prices inched slightly lower in electronic trading on Globex by Tuesday afternoon in Tokyo, as traders took profits from a nearly 3% rise in oil prices last week. Crude oil futures for November delivery was down slightly at $72.94 per barrel on Globex, after tapping a low of $72.83.

Crude oil prices had gained 2% on Monday alone, to close above $73 a barrel, helped by a weak U.S. dollar and higher oil demand forecasts on Friday from the IEA for this year and next. On Monday, the contract rose $1.50 to finish at $73.27 on the NYMEX after hitting an intraday high of $73.86.

“The run up on Monday of over $1.50 was unexpected, and I am sure a lot of traders made a bunch of unexpected money,” said Charles Perry, president of energy consulting firm Perry Management. “So it is logical to lock that increase in.” He believes that the decline in oil prices is temporary, but also pointed out that the dollar will continue to be a big factor for the market.

“With the debt the US is piling up and the amount it is borrowing, the future for the dollar is not too bright,” Perry said. “This is all dependent on the economy not recovering rapidly. Longer term, when the economy does recover, there will be a much higher demand for oil which will drive the price up,” he said. “So either way, I do not see much that would cause the oil prices to decline.”

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