Brent oil closes at $108 as volatile markets influence prices

Brent oil prices closed off Friday’s trading session to end a mixed trading week near $108 a barrel as volatile currency and stock markets around the world continue to have a large influence on the price of oil.

Brent Oil Futures – Closing Price

ICE Brent crude oil futures for September 2011 delivery ended the week’s trading session at $107.90 a barrel on the ICE Futures Exchange as both Brent oil and US WTI contracts posted their third straight weekly losses.

Brent oil prices lost 1.2 percent for the week, but recovered from a weekly low of $98.74 a barrel.

A Week of Uncertain Markets

Oil prices and global stock markets have been buffeted lower and higher this week, starting when trading resumed after the downgrade of the US credit rating by Standard & Poor’s late last Friday.

Volatility continued after the US Federal Reserve on Tuesday noted weaker economic growth and promised to keep benchmark interest rates near zero through to at least 2013.

Oil Trading Volumes

Tepid crude oil trading volumes may have reflected uncertainty, with Brent and US WTI volumes only approaching 600,000 lots in post settlement trading on Friday. US WTI volumes were lowest since late
July when the debt limit fight in Congress was stalling trading, after topping 1 million lots on Thursday.

Total open interest continued to rise during the week, despite the week’s oil price plunges and volatility.

“Open interest rising could be new shorts or new longs. But it’s true that rising open interest in a down market is more likely new shorts entering the market.” said Tom Bentz, director, BNP Paribas Commodities Futures Inc in New York.