The weaker dollar has helped support crude oil prices this morning, with front month WTI climbing back above $79/bbl and Brent climbing back above $78/bbl however crude oil is still very much rangebound, perfectly highlighted by Brent opening and closing at the same level yesterday.
Front month WTI was also little changed overall on Tuesday, however this masks a $2.62 intraday price range. After a decent start, profit taking activity emerged during the afternoon, sending prices from a high of $80.51 to $77.89 in the space of around 2 hours or so. Decent support emerged around $78 however, with prices recovering again late-on.
With the lack of movement in the price, the focus of the market has switched to the more peripheral and gossipy elements that may impact on the market over the coming weeks, namely various OPEC members talking about perhaps not needing to make any cuts, and rumours that the CFTC may have regulations regarding position limits in place by early December.
A Federal holiday in the US means that the usual US Department of Energy inventory data will be released tomorrow. Consequently it appears crude is set for another dollar-driven but ultimately rangebound day.
After little change yesterday, (API2 for Dec-09 up 10¢), coal prices are a bit stronger this morning on the back of firmer physical demand. Also supporting prices are reports of mounting vessel queues at Newcastle.
The latest estimates of vessel arrivals for November are coming in at around 9.5 million tones of capacity, versus a nameplate capacity at the port of only 7.4 million tones per month. As a result the queue of vessels is estimated to increase to around the 50 level by the end of the month, compared with the current level of around 24.
