Asian Current Oil Prices Increase on QE3 Announcement

Asia’s current oil prices increased as traders celebrated the announcement of the US Federal Reserve of a new set of quantitative easing, according to analysts.

In the NYMEX, the crude price per barrel for October delivery gains 65 cents to $98.86.  Meanwhile, Brent North Sea oil for delivery in November rises 56 cents to $116.44.

The crude price per barrel of Brent for October delivery recently rose to $116.90, its highest level in four months. Current oil prices moved up after the hopes of traders that the Fed will conclude its two-day meeting with an announcement of stimulus measures were met.

Telling people not to worry because QE3 is here, Federal Reserve chairman Ben Bernanke finally made an announcement of another bond-buying program with hopes that it will lead to the U.S. economy’s sustainable recovery. That announcement was what the markets wanted, and they got it.

However, the announcement failed to set any specific time limit for QE3.

Towards the closing of the Federal Reserve’s meeting, it made an announcement of a fresh, unrestricted bond buying program, amounting to $40 billion a month until the job market shows significant improvement as 8.1 percent of Americans still stay unemployed.

The Fed said that its QE3, the third quantitative easing program in less than three years, will take the central bank’s total purchases each month, including current programs, to $85 billion monthly.

Furthermore, the Fed committed to maintain its benchmark rate of interest at very low levels until the mid-parts of 2015.

By: Chris Termeer

Chris Termeer

Chris Termeer is an oil and gas consultant, industry commentator and analyst. His book, Fundamentals of Investing in Oil and Gas provides a comprehensive overview of all aspects of the oil and gas industry, including exploration, drilling, production, storage, transportation and refining, to name but a few.

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