Oil Price Update- Futures Advance As EU Zone Records Strong Economic Performance
Oil futures advanced amidst signs that the Euro zone was experiencing strong economic activity which is expected to strengthen demand of oil from the region. WTI crude futures rose by 0.39 percent to USD $ 99.65 a barrel. Brent crude futures rose by 0.75 percent to USD $ 113.83 a barrel.
The EU’s statistics department in Luxembourg stated that the GDP in the region has increased to 0.8 percent from 0.3 percent. During the first quarter of this year, Germany’s GDP rose by 1.5 percent and France’s GDP rose by 1 percent. These two economic powerhouses, along with strong economic performance from the Netherlands and Austria, have helped to push growth upwards in the region, in spite of the debt crisis being suffered by Greece, Portugal and Spain.
On the strength of this performance, domestic demand of oil from the region is expected to increase, leading to the price hike in oil futures.
The WTI also extended its run on fresh concerns that flooding in the Mississippi River would affect oil production in the region. There are strong chances of the Morganza spillway being opened in order to ease the pressure of rising water levels on the river. If the spillway is indeed opened, it would inundate the Atchafalaya River basin, affecting around 2264 oil wells that produce 19,278 barrels of oil every day.