Oil rose for a third day in New York after the dollar weakened against the euro and a government report showed a drop in U.S. gasoline stockpiles, bolstering optimism in an economic recovery.
Futures climbed 0.5 percent yesterday as the U.S. currency fell on speculation the Federal Reserve will act to revive the economy by buying bonds. Fed Chairman Ben S. Bernanke said Oct. 4 that restarting large-scale asset purchases would probably spur growth. The Energy Information Administration said fuel supplies slipped more than forecast by a Bloomberg News survey.
“The Federal Reserve is making it clear that they have got the capacity to engage in monetary stimulus if needed, and the market is viewing that as big brother stepping up to the plate,” said David Taylor, a market analyst at CMC Markets Ltd. in Sydney. “That’s seeing a lower U.S. dollar and encouraging investment into commodities.”
The November contract rose as much as 36 cents, or 0.4 percent, to $83.59 a barrel in electronic trading on the New York Mercantile Exchange at 12:55 p.m. Singapore time. Yesterday it climbed 41 cents to $83.23, the highest settlement since May 3. Prices have gained 5.3 percent this year.
Oil also advanced after an Energy Department report showed gasoline inventories decreased 2.65 million barrels to 219.9 million. They were estimated to decline 250,000 barrels, according to a Bloomberg News survey. Stockpiles of distillate fuel, a category that includes heating oil and diesel, dropped 1.12 million barrels.
Dollar Falls
The dollar traded little changed at $1.3918 against the euro after slipping 0.7 percent yesterday. A weaker U.S. currency bolsters the appeal of commodities as an alternative investment to investors.
“The dollar’s continued plummet is helping to support commodity prices,” said Mike Sander of Sander Capital Advisors in Seattle in an e-mail. “The inventory report helped to spike the price of oil.”
Crude supplies jumped 3.09 million barrels to 360.9 million in the week ended Oct. 1, the Energy Department said. Stockpiles were forecast to gain 413,000 barrels, according to the median of 14 analyst estimates in a Bloomberg News survey. Fuel consumption fell 6.4 percent to 18.5 million barrels a day in the week ended Oct. 1, the biggest weekly decline since Feb. 27, 2004, according to the department.
Companies in the U.S. unexpectedly cut 39,000 workers last month, figures from ADP Employer Services showed. The median estimate of 37 economists surveyed by Bloomberg News called for a 20,000 gain.
“The U.S. ADP employment data surprisingly fell -- a lead indication that Friday’s key payrolls data could be negative,” Mark Pervan, head of commodity research at Australia & New Zealand Banking Group Ltd. in Melbourne, said in a note today. “On the supply side, U.S. Energy Information Administration oil inventory data was bearish.”
Brent crude for November settlement rose 34 cents, or 0.4 percent, to $85.40 a barrel on the London-based ICE Futures Europe exchange. Yesterday it climbed 22 cents, or 0.3 percent, to end the session at $85.06.
To contact the reporters on this story: Ben Sharples in Melbourne at bsharples@bloomberg.net; Christian Schmollinger in Singapore at Christian.s@bloomberg.net
To contact the editor responsible for this story: Clyde Russell in Singapore at crussell7@bloomberg.net
http://jodnet.blogspot.com
Futures climbed 0.5 percent yesterday as the U.S. currency fell on speculation the Federal Reserve will act to revive the economy by buying bonds. Fed Chairman Ben S. Bernanke said Oct. 4 that restarting large-scale asset purchases would probably spur growth. The Energy Information Administration said fuel supplies slipped more than forecast by a Bloomberg News survey.
“The Federal Reserve is making it clear that they have got the capacity to engage in monetary stimulus if needed, and the market is viewing that as big brother stepping up to the plate,” said David Taylor, a market analyst at CMC Markets Ltd. in Sydney. “That’s seeing a lower U.S. dollar and encouraging investment into commodities.”
The November contract rose as much as 36 cents, or 0.4 percent, to $83.59 a barrel in electronic trading on the New York Mercantile Exchange at 12:55 p.m. Singapore time. Yesterday it climbed 41 cents to $83.23, the highest settlement since May 3. Prices have gained 5.3 percent this year.
Oil also advanced after an Energy Department report showed gasoline inventories decreased 2.65 million barrels to 219.9 million. They were estimated to decline 250,000 barrels, according to a Bloomberg News survey. Stockpiles of distillate fuel, a category that includes heating oil and diesel, dropped 1.12 million barrels.
Dollar Falls
The dollar traded little changed at $1.3918 against the euro after slipping 0.7 percent yesterday. A weaker U.S. currency bolsters the appeal of commodities as an alternative investment to investors.
“The dollar’s continued plummet is helping to support commodity prices,” said Mike Sander of Sander Capital Advisors in Seattle in an e-mail. “The inventory report helped to spike the price of oil.”
Crude supplies jumped 3.09 million barrels to 360.9 million in the week ended Oct. 1, the Energy Department said. Stockpiles were forecast to gain 413,000 barrels, according to the median of 14 analyst estimates in a Bloomberg News survey. Fuel consumption fell 6.4 percent to 18.5 million barrels a day in the week ended Oct. 1, the biggest weekly decline since Feb. 27, 2004, according to the department.
Companies in the U.S. unexpectedly cut 39,000 workers last month, figures from ADP Employer Services showed. The median estimate of 37 economists surveyed by Bloomberg News called for a 20,000 gain.
“The U.S. ADP employment data surprisingly fell -- a lead indication that Friday’s key payrolls data could be negative,” Mark Pervan, head of commodity research at Australia & New Zealand Banking Group Ltd. in Melbourne, said in a note today. “On the supply side, U.S. Energy Information Administration oil inventory data was bearish.”
Brent crude for November settlement rose 34 cents, or 0.4 percent, to $85.40 a barrel on the London-based ICE Futures Europe exchange. Yesterday it climbed 22 cents, or 0.3 percent, to end the session at $85.06.
To contact the reporters on this story: Ben Sharples in Melbourne at bsharples@bloomberg.net; Christian Schmollinger in Singapore at Christian.s@bloomberg.net
To contact the editor responsible for this story: Clyde Russell in Singapore at crussell7@bloomberg.net
http://jodnet.blogspot.com
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