Oil rising on Libya supply concerns and FOMC in focus

Oil rising on Libya supply concerns and FOMC in focus 

 

Brent futures rose above $109 a barrel on Monday as supply concerns revived after Libya failed to reach a deal with tribal leaders to end the closure of several oil-exporting ports. 

Crude prices, however, may remain in a range like most other markets as investors await the U.S. Federal Reserve's decision on tapering its monetary stimulus, which has been a key driver of investment in global commodities. 

Brent crude fetched $110 a barrel, while US crude oil is trading around $97.21
 Libyan oil ports remain closed despite promised reopening along with the continuing strikes of Oil workers have cut vital oil exports to 110,000 barrels per day from more than 1 million in July.

Investors are also waiting for the Fed meeting outcomes to see whether it will start tapering the stimulus program of $85 bonds buying or delay it to 2014.

 Accordingly we expect two scenarios: 

*a cut in stimulus program will boost the dollar and weight on more commodities including oil.
*a delay of tapering will push the dollar down, and increase the demand of the black gold.

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