Oil hovers above $71 amid weak demand, US dollar
Oil prices hovered above $71 a barrel Wednesday as signs of weak crude demand were offset by the effects of a slumping U.S. dollar.
By mid-afternoon in Europe, benchmark crude for November delivery was down 44 cents at $71.32 a barrel in electronic trading on the New York Mercantile Exchange. The contract added $1.83 a barrel to settle at $71.76 on Tuesday.
Oil prices have traded between $65 and $75 for months as consumer demand in the U.S. has remained tepid despite evidence of an economic recovery.
“Brimming oil stocks around the world continue to expose demand weakness,” said JBC Energy in Vienna.
U.S. oil inventories rose unexpectedly last week, the American Petroleum Institute said late Tuesday. Crude stocks increased 276,000 barrels while analysts had expected a drop of 2.25 million barrels, according to a survey by Platts, the energy information arm of McGraw-Hill Cos.
“The reason oil is trading in this range is this battle between weak supply fundamentals and optimism for economic recovery,” said Victor Shum, an energy analyst with consultancy Purvin & Gertz in Singapore.
“This seems to be a level that both producers and consumers are happy with.”
A weakening U.S. dollar, meanwhile, has helped support oil prices. Because crude is priced in dollars, investors outside the U.S. buy it up when the dollar drops. The euro rose Wednesday in European trading to $1.4817 from $1.4788 the previous day while the dollar fell to 90.99 yen from 91.15.
Olivier Jakob of Petromatrix in Switzerland said that while the Dollar Index — which values the dollar against a basket of foreign currencies — was now at same level as in September 2008, back then the Nymex contract was worth $109 a barrel.
The big difference, Jakob noted, “is that U.S. petroleum stocks are at least 140 million barrels above the levels of a year ago.”
In other Nymex trading, gasoline for October delivery was down 1.72 cents to $1.7644 a gallon, and heating oil gained 0.38 cent to $1.8159 a gallon. Natural gas was up 10.9 cents to $3.718 per 1,000 cubic feet.
In London, Brent crude fell 45 cents to $70.08 on the ICE Futures exchange.
Associated Press writer Alex Kennedy in Singapore contributed to this report from Singapore.
Related News
Oil prices hovers above $71 in Asia as US dollar reboundsOctober 9th, 2009 Oil prices hovers above $71 as US dollar gainsSINGAPORE — Oil prices hovered above $71 a barrel Friday in Asia as the U.S. dollar rebounded.
Oil around $71 in European afternoon trade as US supplies rise, suggesting demand is weakSeptember 16th, 2009 Oil hovers around $71 amid rising US suppliesLONDON — Oil traded just above $71 a barrel Wednesday as investors weighed a weakening dollar — which supports commodity prices — against a rise in crude supplies, which suggests demand remains weak. Benchmark crude for October delivery was up 13 cents to $71.06 a barrel by mid-afternoon in Europe in electronic trading on the New York Mercantile Exchange.
Oil hovers under $71 in European morning trade as US supplies rise, suggesting demand is weakSeptember 16th, 2009 Oil hovers under $71 as US crude supplies climbLONDON — Oil traded just below $71 a barrel Wednesday as an unexpected rise in U.S. crude supplies heightened investor concerns about weak consumer demand.
Oil hovers near $71 in Asia as US crude supplies rise, suggesting demand still weakSeptember 16th, 2009 Oil hovers near $71 as US crude supplies climbSINGAPORE — Oil prices hung near $71 a barrel Wednesday in Asia as an unexpected rise in U.S. crude supplies heightened investor concerns about weak consumer demand.
Oil near $69 in midday European trade as investors weigh weak crude demand, economic recoverySeptember 15th, 2009 Oil hovers near $69 amid weak crude demandOil prices hovered near $69 a barrel Tuesday as investors weighed concerns about weak crude demand against optimism of a global economic recovery. By midday in Europe, benchmark crude for October delivery was up 16 cents at $69.02 a barrel in electronic trading on the New York Mercantile Exchange.
Oil hovers below $69 in Asia as investors weigh weak crude demand, economic recoverySeptember 14th, 2009 Oil hovers below $69 amid weak crude demandSINGAPORE — Oil prices hovered below $69 a barrel Tuesday in Asia as investors weighed concerns about weak crude demand against optimism of a global economic recovery. Benchmark crude for October delivery was down 1 cent at $68.84 a barrel at late afternoon Singapore time in electronic trading on the New York Mercantile Exchange.
Oil hovers above $69 in Asia amid forecasts for weak crude demand this yearAugust 12th, 2009 Oil hovers above $69 amid weak crude demandSINGAPORE — Oil prices hovered above $69 a barrel Wednesday in Asia after the U.S. and OPEC said global crude consumption will slump this year as economies struggle to emerge from recession.
Oil hovers above $63 in Asia amid rising US crude inventories, sluggish economyJuly 30th, 2009 Oil hovers above $63 amid weak US crude demandSINGAPORE — Oil prices paused above $63 a barrel Thursday in Asia after signs of weak U.S. crude demand triggered a sharp sell-off this week.
Oil hovers near $63 in Asia amid rising US crude inventories, sluggish economyJuly 30th, 2009 Oil hovers near $63 amid weak US crude demandSINGAPORE — Oil prices paused near $63 a barrel Thursday in Asia after signs of weak U.S. crude demand triggered a sharp sell-off this week.
Oil hovers below $64 in Asia as investors eye company results, weak crude demandJuly 21st, 2009 Oil hovers below $64 as earnings, demand weighedSINGAPORE — Oil prices hovered near $64 a barrel Tuesday in Asia as investors weighed improving corporate results against weak crude demand. Benchmark crude for August delivery was down 23 cents to $63.75 a barrel by midday Singapore time in electronic trading on the New York Mercantile Exchange.
Oil hovers near $60 in Asia as investors look to company earnings for crude demand signsJuly 10th, 2009 Oil hovers near $60 as traders eye company resultsSINGAPORE — Oil prices hovered just above $60 a barrel Friday in Asia as investors braced for a slew of company earnings reports next week that will provide clues on the strength of crude demand. Benchmark crude for August delivery was down 9 cents at $60.32 a barrel by midday Singapore time in electronic trading on the New York Mercantile Exchange.
Oil hovers above $66 in Asia after weak jobs numbers undermine investor confidenceJuly 3rd, 2009 Oil hovers above $66 in Asia after weak jobs dataSINGAPORE — Oil prices hovered above $66 a barrel Friday in Asia in light holiday trading a day after grim unemployment numbers from the U.S. and Europe sent crude prices tumbling.
Oil hovers above $69 in Asia amid mixed signals from US inventories, Federal ReserveJune 25th, 2009 Oil hovers above $69 amid mixed crude demand signsSINGAPORE — Oil prices hovered just above $69 a barrel Thursday in Asia amid mixed signals about crude demand from a weekly U.S. inventory report.
Oil hovers below $71 in Asia on investor concern recent rally went too far, too fastJune 16th, 2009 Oil hovers below $71 on economic recovery concernsSINGAPORE — Oil prices hovered below $71 as investors mulled whether a three-month rally went too far, too fast amid high supplies and weak demand. Benchmark crude for July delivery rose 24 cents to $70.86 a barrel by late afternoon Singapore time in electronic trading on the New York Mercantile Exchange.
Oil hovers under $69 in Asia ahead of US jobs reportJune 5th, 2009 Oil hovers under $69 in AsiaBANGKOK — Oil hovered just under $69 a barrel Friday in Asia as the first drop in U.S. unemployment claims in five months provided another sign that weak demand for crude could improve.
Loading ...