Oil prices give up gains and turn to stability ahead of “Baker Hughes” data

Mohammed Abdelkhalik
August 28, 2020

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Oil prices stabilized during trading on Friday, giving up the gains it had recorded earlier in the session, ahead of data release from Baker Hughes for oil services.

Oil prices received support this week from a strong storm that hit coast of Gulf of Mexico, a vital area in US energy industry.

Oil and natural gas production activities have been largely suspended in Gulf of Mexico, which in turn affects US gross domestic product.

Baker Hughes will announce later today data on number of drilling rigs for oil and natural gas in America for this week.

oil prices

In terms of trading, US Nymex crude futures for October delivery settled at 18:36 GMT at 43.04 dollars a barrel, and recorded the day’s highest price at $ 43.4 and the lowest price at $ 42.6.

Brent crude futures for October delivery settled at 45.10 dollars a barrel, and recorded highest price at 45.3 dollars and lowest price at 44.8 dollars.

Oil prices affect federal reserve policy

USD fell against most of the major currencies during trading on Friday, adding to its losses after US central bank’s move on inflation policy.

Federal Reserve decided to adopt a policy of average inflation above 2% for some time, in a speech to “Jerome Powell” on sidelines of “Jackson Hole” meetings.

Government data showed that consumer spending in United States rose 1.9% in July, compared to expectations for a 1.5% rise, and personal income index rose 0.4%, compared to expectations for a 0.3% decline.

Moreover, US Consumer Confidence Index also rose to 74.1 points, compared to expectations that the index had stabilized at 72.8 points.

US President Donald Trump said that he accepted Republican nomination to run in the presidential election scheduled for November against his Democratic rival, “Joe Biden.”

Trump stressed that Biden would not preserve patriotism, but rather would destroy American jobs.

In terms of trading, dollar index fell (against a basket of major currencies) by 17:38 GMT by 0.6% to 92.4 points, and highest level was recorded at 93.1 points and lowest level at 92.2 points.

Author Mohammed Abdelkhalik

Professional Trader and Analyst, economist in Financial and Forex market since 2004.holds an MBA from the American University in Egypt. Mohammed works as an economic writer and technical & fundamental analyst for many international Forex and financial trading companies in both English and Arabic on a daily basis.