Oil trades near highest on outlook for US economic growth
Oil traded near the highest in a week in New York as speculation that economic growth will boost fuel demand in the US countered concern that Europe's debt crisis will worsen.
By Bloomberg | Updated:
SINGAPORE: Oil traded near the highest in a week in New York as speculation that economic growth will boost fuel demand in the US countered concern that Europe's debt crisis will worsen.
Futures advanced 1.2% from the close on May 25. US consumer confidence probably gained in May and job growth may have picked up, according to surveys by Bloomberg News before reports this week. The US Memorial Day holiday on Monday marked the start of the nation's peak driving period.
"The US situation is hopeful, with demand numbers improving lately as we kick off the summer driving season," said Andrey Kryuchenkov, an analyst at VTB Capital in London, who predicts oil will trade from $84 and $96 a barrel next month. "But at the same time inventories are high, so we'd really need refinery runs to hold up early summer to work through the excess crude."
Crude for July delivery climbed $1.13 to $91.99 a barrel in electronic trading on the New York Mercantile Exchange, the highest since May 22, and was at $91.23 at 12:42 pm London time. Front-month prices are down 7.7% this year.
Brent oil for July settlement was at $106.94 a barrel, down 17 cents, on the London-based ICE Futures Europe Exchange. Prices have fallen 10% in May. The European benchmark contract's premium to West Texas Intermediate was at $15.72, compared with $16.12 on Monday.
Oil's slump this month may be stalling as futures trade close to $90 a barrel, according to technical analysis by Auerbach Grayson & Co.
Futures advanced 1.2% from the close on May 25. US consumer confidence probably gained in May and job growth may have picked up, according to surveys by Bloomberg News before reports this week. The US Memorial Day holiday on Monday marked the start of the nation's peak driving period.
"The US situation is hopeful, with demand numbers improving lately as we kick off the summer driving season," said Andrey Kryuchenkov, an analyst at VTB Capital in London, who predicts oil will trade from $84 and $96 a barrel next month. "But at the same time inventories are high, so we'd really need refinery runs to hold up early summer to work through the excess crude."
Crude for July delivery climbed $1.13 to $91.99 a barrel in electronic trading on the New York Mercantile Exchange, the highest since May 22, and was at $91.23 at 12:42 pm London time. Front-month prices are down 7.7% this year.
Brent oil for July settlement was at $106.94 a barrel, down 17 cents, on the London-based ICE Futures Europe Exchange. Prices have fallen 10% in May. The European benchmark contract's premium to West Texas Intermediate was at $15.72, compared with $16.12 on Monday.
Oil's slump this month may be stalling as futures trade close to $90 a barrel, according to technical analysis by Auerbach Grayson & Co.
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