Oil headed for its biggest weekly gain in almost two months in New York after U.S. economic reports indicated that growth in the world’s biggest crude consumer will accelerate.
Futures were little changed today after advancing 0.9 percent yesterday as the reports showed U.S. initial jobless claims dropped to the lowest level since April 2008, leading indicators climbed more than forecast in November, and consumer sentiment improved this month. U.S. oil supplies fell the most in a decade last week, the Energy Department said Dec 23. The European Central Bank awarded a record 489 billion euros ($639 billion) in loans on Dec. 21 to ease the region’s debt crisis.
“We’re seeing a less-worse situation in Europe and a clear series of data from the U.S. showing economic recovery,” said Michael McCarthy, a chief market strategist at CMC Markets Asia Pacific Pty in Sydney. “All of that is adding up to a better demand picture for oil.”
Crude oil for February delivery was at $99.63 a barrel, up 10 cents, in electronic trading on the New York Mercantile Exchange at 9:50 a.m. Singapore time. The contract yesterday rose 86 cents to $99.53, the highest settlement since Dec. 13.
Prices are up 6.5 percent this week, the biggest gain since the period ended Oct. 28. Futures have climbed 9 percent this year after increasing 15 percent in 2010.
Brent oil for February settlement was at $107.78 a barrel, down 11 cents, on the London-based ICE Futures Europe exchange yesterday. The European contract’s premium to Nymex crude was $8.15 a barrel, compared with a close yesterday of $8.36 that was the smallest differential since March 8. The spread surged to a record $27.88 on Oct. 14.
U.S., Iran
U.S. initial unemployment claims fell by 4,000 to 364,000 last week, Labor Department figures showed yesterday in Washington. The Conference Board’s gauge of the outlook for the next three to six months rose 0.5 percent, versus a median forecast of 0.3 percent in a Bloomberg survey.
The Thomson Reuters/University of Michigan final index of consumer sentiment increased to 69.9 in December from 64.1 at the end of the previous month. The median estimate of economists surveyed by Bloomberg News called for a reading of 68.
Crude oil may rise next week on speculation that sanctions against Iran will curb supply from the world’s third-largest oil exporter, a separate Bloomberg survey showed.
Twelve of 32 analysts, or 38 percent, forecast oil will gain through Dec. 30. Ten respondents, or 31 percent, predicted prices will drop and 10 estimated there will be little change. Oil is up 26 percent this quarter, the biggest gain since the second quarter of 2009.
‘Political Tension’
The European Union and the U.S. are seeking support from the Middle East and Asia for sanctions to increase pressure on Iran to abandon a suspected nuclear weapons program. Iran’s navy will hold 10 days of maneuvers east of the Strait of Hormuz, state-run Fars news agency reported yesterday, citing Navy Commander Habibollah Sayari.
“You’ve got this background of political tension,” supporting oil prices, said Gavin Wendt, senior resource analyst at Mine Life Pty in Sydney. “This situation with Iran is coming to a head sooner rather than later.”
About 15.5 million barrels of oil a day, or a sixth of global consumption, flows through the waterway between Iran and Oman at the mouth of the Persian Gulf, according to the U.S. Department of Energy. Sayari said Iran’s military has the capability to “control” the strait, according to a second Fars report. Whether it chooses to close the channel “depends on the decision of Iran’s higher officials,” he said.
EU foreign ministers are scheduled to meet next month to discuss possible sanctions on Iranian oil. Iran, which exports more crude than any nation except Saudi Arabia and Russia, denies trying to develop nuclear weapons.
Futures were little changed today after advancing 0.9 percent yesterday as the reports showed U.S. initial jobless claims dropped to the lowest level since April 2008, leading indicators climbed more than forecast in November, and consumer sentiment improved this month. U.S. oil supplies fell the most in a decade last week, the Energy Department said Dec 23. The European Central Bank awarded a record 489 billion euros ($639 billion) in loans on Dec. 21 to ease the region’s debt crisis.
“We’re seeing a less-worse situation in Europe and a clear series of data from the U.S. showing economic recovery,” said Michael McCarthy, a chief market strategist at CMC Markets Asia Pacific Pty in Sydney. “All of that is adding up to a better demand picture for oil.”
Crude oil for February delivery was at $99.63 a barrel, up 10 cents, in electronic trading on the New York Mercantile Exchange at 9:50 a.m. Singapore time. The contract yesterday rose 86 cents to $99.53, the highest settlement since Dec. 13.
Prices are up 6.5 percent this week, the biggest gain since the period ended Oct. 28. Futures have climbed 9 percent this year after increasing 15 percent in 2010.
Brent oil for February settlement was at $107.78 a barrel, down 11 cents, on the London-based ICE Futures Europe exchange yesterday. The European contract’s premium to Nymex crude was $8.15 a barrel, compared with a close yesterday of $8.36 that was the smallest differential since March 8. The spread surged to a record $27.88 on Oct. 14.
U.S., Iran
U.S. initial unemployment claims fell by 4,000 to 364,000 last week, Labor Department figures showed yesterday in Washington. The Conference Board’s gauge of the outlook for the next three to six months rose 0.5 percent, versus a median forecast of 0.3 percent in a Bloomberg survey.
The Thomson Reuters/University of Michigan final index of consumer sentiment increased to 69.9 in December from 64.1 at the end of the previous month. The median estimate of economists surveyed by Bloomberg News called for a reading of 68.
Crude oil may rise next week on speculation that sanctions against Iran will curb supply from the world’s third-largest oil exporter, a separate Bloomberg survey showed.
Twelve of 32 analysts, or 38 percent, forecast oil will gain through Dec. 30. Ten respondents, or 31 percent, predicted prices will drop and 10 estimated there will be little change. Oil is up 26 percent this quarter, the biggest gain since the second quarter of 2009.
‘Political Tension’
The European Union and the U.S. are seeking support from the Middle East and Asia for sanctions to increase pressure on Iran to abandon a suspected nuclear weapons program. Iran’s navy will hold 10 days of maneuvers east of the Strait of Hormuz, state-run Fars news agency reported yesterday, citing Navy Commander Habibollah Sayari.
“You’ve got this background of political tension,” supporting oil prices, said Gavin Wendt, senior resource analyst at Mine Life Pty in Sydney. “This situation with Iran is coming to a head sooner rather than later.”
About 15.5 million barrels of oil a day, or a sixth of global consumption, flows through the waterway between Iran and Oman at the mouth of the Persian Gulf, according to the U.S. Department of Energy. Sayari said Iran’s military has the capability to “control” the strait, according to a second Fars report. Whether it chooses to close the channel “depends on the decision of Iran’s higher officials,” he said.
EU foreign ministers are scheduled to meet next month to discuss possible sanctions on Iranian oil. Iran, which exports more crude than any nation except Saudi Arabia and Russia, denies trying to develop nuclear weapons.
