On the freight markets yesterday, red again prevailed. The CRB index recorded a discount by 0.14% up to 225.06 point This time, however, oil prices were not at the price of oil but, above all, prices of cereals and precious metals were falling. The oil market is worth mentioning in the context of yesterday's correction.
Brent's oil quotations tested the level on Wednesday 50 USD for a barrel as support – and it proved effective. In turn for WTI oil prices, such a barrier was the level 48 USD for a barrel. In the morning, the U.S. oil market fell below that level, but eventually bounced upwards, approaching the surrounding area 49 USD for a barrel.
The dynamic rise in oil prices cannot be expected with the current fundamental situation in this market. This can be seen already after today's price behaviour of this raw material – although WTI oil prices are growing, but symbolically, it is continuing below 49 USD for a barrel.
Nevertheless, more and more investors have ceased to believe in further declines and are investing their capital in oil-based ETF funds. In December 2014 Inflow of funds to four The largest ETF funds of this type have been the largest since May 2010
Yesterday, as every week, a report by the U.S. Department of Energy (DoE) was published on the change in fuel stocks. This report reported that in the past week oil stocks in the US have fallen by 3,100,000 barrels. This value has indeed passed with market expectations, as an increase in stocks was expected by one million barrels. This issue was another positive factor in the oil quotations on yesterday.
However, the DoE report affected not only the price of oil but also corn on Wednesday. The Department also stated that in the past week ethanol stocks increased by 751,000 barrels to level 18,850,000 barrels. That's the highest level of them from almost 2 years.
This information means weakening demand for ethanol, which also translates into the listing of maize. Ethanol is primarily produced from maize. It forms part of biofuels, for which demand in recent times, as in fact demand for many energy raw materials, has not kept up with supply.
In addition, it is worth mentioning that the supply pressure on the corn market is also caused by the large production of this grain in the USA in the past year. The autumn corn harvest overseas was record-breaking.