Oil prices fell today as investors took the recent rise in prices as a chance to sell and make profits, while worries of escalating tensions in the Middle East capped further losses.
Brent crude declined by 36 cents to $105.10 a barrel, while US oil dropped by 44 cents to $95.71, reported Reuters.
Prices also came under pressure due to apprehensions following a further build in the US commercial crude stocks after reaching a record high.
A survey conducted by Reuters, ahead of the release of weekly inventory reports by the American Petroleum Institute (API) and the US Energy Department’s Energy Information Administration (EIA), predicted that on average crude stocks rose by 1.8 million barrels in the week ended 3 May.
On Monday, Morgan Stanley said in a research note that Brent crude is anticipated to increase in the second half of 2013.
The financial services also said that global oil balance was under pressure this summer as Brent prices are expected to trade up to $110-$115 per barrel in the second half of 2013.
On Monday, the IntercontinentalExchange (ICE) released data which showed that hedge funds and other large speculators rose bets on higher Brent prices in the week to 30 April, increasing their net long positions by 9,614 contracts to 108,741.
Oil also received support from a record close of the Standard & Poor’s 500 Index, on expectation of a stable US recovery.
However, tensions in the Middle East have escalated after Israel downplayed reports that weekend air strikes close to Damascus killed dozens of Syrian soldiers.
Image: A Reuters survey predicted that on average crude stocks would have increased by 1.8 million barrels in the week ended 3 May. Photo courtesy of freedigitalphotos / meepoohfoto.
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