The price of oil fell below $87 a barrel as investors moved to the sidelines to consider President Barack Obama’s comments outlining efforts to help the US recovery. In his State of the Union Address, the President said his administration would close corporate tax loopholes but would lower overall business taxes. There is also the question of further policy tightening in China as authorities work to keep the lid on inflation.
Meanwhile, crude inventories are on the rise and OPEC is even signaling that it is prepared to increase production.
“Prices will likely remain within a $80-$95 trading range … with the downside bias becoming more noticeable during the beginning of the second quarter when crude enters it seasonally weaker period,” said senior commodity analyst Edward Meir at MF Global in New York.
Sources: The Canadian Press
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