Oil Closes Near $126 A Barrel

(RTTNews) - Oil soared on Friday in U.S. trading and extended its record highs again. Light sweet crude closed at $125.96, up $2.27 on the session. Oil touched as high as $126.25 in the mid-afternoon, again taking out its record highs.

Crude gained $10.64 a barrel for the week and has gained more than $13 a barrel from its closing levels of May 1 amid ongoing global supply concerns. After hovering lower for most of Thursday, oil surged in the late afternoon and again extended its record highs. Light sweet crude for July delivery closed at $123.69, up 16 on the session. Oil touched as high as $124.57, taking out its daily highs reached in overnight transactions. Prices began to surge at around 1:30 p.m. ET to extend the highs of the day.

Oil topped $123 for the first time in Wednesday’s session, despite a larger-than-predicted build in inventories. Traders shook off the inventory data from Wednesday morning as the Energy Information Administration released its report showing that crude oil inventories increased by 5.7 million barrels, more than expected. Crude added $1.87 on Tuesday amid comments from analysts suggesting $200 oil may come within the next two years. Prices topped the $120 mark for the first time ever on Monday.

Stochastics and the RSI continued to indicate over-bought levels for June oil. The $130 may serve as psychological resistance in the short-term if the rally continues. Prices turned sharply lower earlier this month after approaching $120, before eventually shattering that mark early this week. If June turns lower, Wednesday’s low crossing of $120.54 could provide support.

On Friday morning, the Department of Commerce released its report on U.S. international trade in goods and services in the month of March, showing that the U.S. trade deficit narrowed by much more than economists had been expecting. The report showed that the trade deficit narrowed to $58.2 billion in March from a revised $61.7 billion in February. Economists had expected the deficit to narrow to $61.3 billion from the $62.3 billion originally reported for the previous month.

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