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Brent oil price slides below $70 in busy trading session
Published on February 6, 2010 by oilprices · No CommentsICE Brent oil futures for March slipped nearly four percent in a busy trading session on Friday and ends the week at $69.59 a barrel on the London based ICE Futures Exchange. Brent oil prices are currently trading at a $1.60 a barrel discount to US Light crude oil futures, the widest level since January 22nd. A greater differential may prompt shipments to the US from Europe.
“Brent is falling even faster, and the differential is widening because of all of the worries about the European economy,” said Tom Bentz, a senior energy analyst at BNP Paribas Commodity Futures Inc. in New York.
“The market’s getting crushed,” said Stephen Schork, president of Schork Group Inc., an energy trading consultant in Villanova, Pennsylvania. “The 200 day moving average was $70.50. As soon as we went through that number, all hell broke loose.”
“You saw a technical breakdown at around $72.40 and probably some of the more stubborn longs finally capitulated and the emergence of new shorts about the rising doubt of economic recovery and poor fundamentals” came into play, said Gene McGillian, an analyst and broker at Tradition Energy in Stamford, Connecticut.
Long positions are bets that crude oil prices will rise and short positions are wagers that the oil futures prices will decline. The plunge in Brent oil prices accelerated after the contract broke through support levels that technical traders look at for signals to sell futures.
Tags: brent, exchange, ICE, london, oil futures, session, trading