After sharp rise, oil prices plunge again
Oil prices resumed their decline on Wednesday following a brief upward blip on the back of positive stats from the United States, Russian news agency Prime has reported.
February futures for North Sea Brent blend dropped by 0.54%, to $61.15 per barrel. February futures for U.S. benchmark WTI light crude oil fell by 0.46%, to $56.66 per barrel.
According to the Bureau of Economic Analysis of the U.S. Department of Commerce, U.S. GDP growth in the third quarter of this year is 5% on an annualized basis. The result was higher than the initial estimate of 3.5%, the second estimate of 3.9%, and analysts’ forecasts of U.S. economy growth at 4.3%.
The oil price was also impacted by the positive consumer sentiment index of the University of Michigan, which reflects the degree of households’ confidence in the U.S. economy. In December it increased to 93.6 points from a level of 88.8 points in November, which is lower than the initial estimates of 93.8 points - the maximum since January 2007, but slightly better than analysts’ forecasts of 93.5 index points.
On the backdrop of the positive data, world oil prices and the value of the dollar have jumped relative to other currencies. According to analysts, a strong dollar makes raw materials, which are priced in U.S. dollars, expensive for holders of other currencies.
Some experts find the economic indicators slightly baffling.
"This is ridiculous. The U.S. economy begins to grow, and oil prices are going in the opposite direction," said Ben le Brun, a market analyst at OptionsXpress in Sydney.