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Crude falls on profit taking, eyes Ukraine standoff

Published 04/25/2014, 01:18 PM
Updated 04/25/2014, 01:19 PM
Profit taking ends oil's rally, though market keeps eye on Ukraine

Investing.com - Crude futures fell on Friday after investors sold the commodity for profits, keeping a wary eye on escalating tensions in Ukraine on concerns the standoff could affect shipments from energy-rich Russia.

On the New York Mercantile Exchange, West Texas Intermediate crude oil for delivery in June traded at $100.75 a barrel during U.S. trading, down 1.17%. New York-traded oil futures hit a session low of $100.51 a barrel and a high of $102.05 a barrel.

The June contract settled up 0.49% at $101.94 a barrel on Thursday.

Nymex oil futures were likely to find support at $100.51 a barrel, the earlier low, and resistance at $102.35 a barrel, Thursday's high.

The ongoing conflict in Ukraine sent oil prices rising to levels ripe for profit taking, as investors digested bearish inventory data this week and concluded crude had risen too far.

The U.S. Energy Information Administration said earlier this week that crude oil inventories rose by 3.52 million barrels in the week ended April 18, surpassing expectations for a build of 2.27 million barrels.

Total U.S. crude oil inventories stood at 397.7 million barrels as of last week, highs not seen in roughly 80 years.

The EIA said total motor gasoline inventories decreased by 0.27 million barrels, compared to forecasts for a decline of 1.71 million barrels, while distillate stockpiles rose by 0.59 million barrels.

Oil prices have remained elevated on events unfolding in Ukraine, which continued to escalate this week after Ukrainian troops killed several pro-Russian rebels on Thursday.

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Russian troops, meanwhile, conducted military drills close to the border between the two countries.

In response, U.S. Secretary of State John Kerry said Washington was moving closer to slapping fresh sanctions on Moscow.

Russia is the world’s second largest oil exporter after Saudi Arabia.

Data out of the U.S. also failed to halt Friday's round of profit taking.

The Thomson Reuters/University of Michigan's final April consumer sentiment index came in at 84.1, beating market expectations for a 83.0 reading. April's preliminary reading was 82.6.

Elsewhere, on the ICE Futures Exchange in London, Brent oil futures for June delivery were down 0.57%, trading at US$109.71 a barrel, while the spread between the Brent and U.S. crude contracts stood at US$8.96 a barrel.

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