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Energy prices climb before Fed meeting
Source: Agencies |
September 21, 2010, Tuesday
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MOST energy contracts, including crude oil, rose yesterday as traders speculated about whether the Federal Reserve will take action this week to boost the sluggish U.S. economy with programs to buy mortgage bonds and Treasurys.
Benchmark crude for October delivery rose US$1.20 to settle at US$74.86 a barrel on the New York Mercantile Exchange. The October contract expires on Tuesday.
Heating oil added 4.02 cents to settle at US$2.1394 a gallon, gasoline gained 3.04 cents to settle at US$1.9496 a gallon and natural gas fell 20.2 cents to settle at US$3.822 per 1,000 cubic feet.
In London, Brent crude rose US$1.50 to settle US$79.32 a barrel on the ICE Futures exchange.
Oil has traded in the US$70s for most of the past year as strong demand from commodities in emerging economies is offset by a sluggish recovery in developed countries. In day-to-day trading, oil prices often follow stock markets and currencies as crude investors look for guidance on overall investor sentiment.
Stocks extended their September rally into a fourth week yesterday as investors hoped for more moves by the Federal Reserve to prop up the economy. The Dow ended up 1.4 percent and broader indexes also closed higher.
Crude inventories in the U.S. are near record highs, reflecting an uneven recovery from last year's recession. Traders will be eyeing weekly supply figures along with the latest housing and job claims numbers later this week.
There is a growing expectation that the Fed's rate-setting committee could relaunch programs to buy Treasurys and mortgage bonds in an effort to further stimulate the struggling U.S. economy. At the very least, it might hint at future plans to make such moves following its one-day meeting Tuesday.
Benchmark crude for October delivery rose US$1.20 to settle at US$74.86 a barrel on the New York Mercantile Exchange. The October contract expires on Tuesday.
Heating oil added 4.02 cents to settle at US$2.1394 a gallon, gasoline gained 3.04 cents to settle at US$1.9496 a gallon and natural gas fell 20.2 cents to settle at US$3.822 per 1,000 cubic feet.
In London, Brent crude rose US$1.50 to settle US$79.32 a barrel on the ICE Futures exchange.
Oil has traded in the US$70s for most of the past year as strong demand from commodities in emerging economies is offset by a sluggish recovery in developed countries. In day-to-day trading, oil prices often follow stock markets and currencies as crude investors look for guidance on overall investor sentiment.
Stocks extended their September rally into a fourth week yesterday as investors hoped for more moves by the Federal Reserve to prop up the economy. The Dow ended up 1.4 percent and broader indexes also closed higher.
Crude inventories in the U.S. are near record highs, reflecting an uneven recovery from last year's recession. Traders will be eyeing weekly supply figures along with the latest housing and job claims numbers later this week.
There is a growing expectation that the Fed's rate-setting committee could relaunch programs to buy Treasurys and mortgage bonds in an effort to further stimulate the struggling U.S. economy. At the very least, it might hint at future plans to make such moves following its one-day meeting Tuesday.
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