Oil Market Update (March 6, 2012)

By Adam Currie – Exclusive to Oil Investing News

Both Brent and West Texas Intermediate (WTI) crude retreated and ended with losses last week after Brent futures jumped above $128 a barrel – a level last seen in July 2008. Analysts believed the spike was in reaction to the aforementioned rumors of a pipeline fire in Saudi Arabia. The surge in prices was short-lived and retreated when Saudi Arabia confirmed that there had been no attack.

US April crude fel to settle at $106.66 a barrel on Monday, dropping as low as $105.80 and pushing below the ten day moving average of $107.04.

Jim Ritterbusch, president at Ritterbusch & Associates, commented in a research note: “Although the oil complex is responding to some softening in the euro and the equities…the main source of selling has been a disgorgement of risk premium following yesterday’s frenzied price advance (on) reports of Saudi pipeline explosions.”