Oversupply sees crude prices fall

EIA data released yesterday revealed a larger than expected crude stock build of 7mio barrels, as opposed to a consensus forecast of around 2.5mio barrels.

This prompted fears of oversupply which precipitated a fall in crude prices. Brent crude closed around $87.80 (€60) with the NYMEX contract dipping to $86.88 (€59.40) - the lowest levels seen for over three months.

Continuing concerns over the health of the US economy lend persistent bearish pressure to prices and in the absence of any fresh factors the market is set to maintain its softness. Rhetoric from OPEC suggesting unchanged production levels in spite of some cartel members seeking cuts serves to fuel the downward impetus.

Today's story will very much take its cues from movements on the equity market and the unfolding global economic story.

Brent looks set to hold the $86.70 (€59.28) support area with resistance suggested at $88.85 (€60.75).