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Oil ends lower as budget deal cheers fade
Source: Agencies |
January 4, 2013, Friday
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THE price of oil drifted lower yesterday as euphoria over a US budget deal cooled and traders focused on bulging crude supplies and lackluster demand.
Benchmark crude for February delivery ended the day down 20 cents to US$92.92 per barrel on the New York Mercantile Exchange. Prices jumped as much as 2 percent Wednesday after a deal in Washington averted the "fiscal cliff" of automatic tax increases and spending cuts.
Despite the stopgap budget deal, more hurdles are ahead for the US economy, including a new deadline for more spending cuts in two months.
Investors also gauged the underlying strength of the global energy market, where demand is weak and supplies are rising.
US crude supplies were nearly 16 percent above the five-year average in the week ending Dec. 21, the most recent period for which statistics are available, according to the Energy Department. It also said US production was at its highest point in 19 years. Data for last week will be released Friday. Analysts expect the report to show crude inventories dropped slightly but remain well above average.
Brent crude, used to price international varieties of oil, fell 33 cents to finish at US$112.14 a barrel on the ICE Futures exchange in London.
In other energy futures trading on the New York Mercantile Exchange:
- Wholesale gasoline was unchanged, ending at US$2.80 a gallon.
- Heating oil lost 2 cents to finish at US$3.03 a gallon.
- Natural gas fell 4 cents to end at US$3.20 per 1,000 cubic feet.
Benchmark crude for February delivery ended the day down 20 cents to US$92.92 per barrel on the New York Mercantile Exchange. Prices jumped as much as 2 percent Wednesday after a deal in Washington averted the "fiscal cliff" of automatic tax increases and spending cuts.
Despite the stopgap budget deal, more hurdles are ahead for the US economy, including a new deadline for more spending cuts in two months.
Investors also gauged the underlying strength of the global energy market, where demand is weak and supplies are rising.
US crude supplies were nearly 16 percent above the five-year average in the week ending Dec. 21, the most recent period for which statistics are available, according to the Energy Department. It also said US production was at its highest point in 19 years. Data for last week will be released Friday. Analysts expect the report to show crude inventories dropped slightly but remain well above average.
Brent crude, used to price international varieties of oil, fell 33 cents to finish at US$112.14 a barrel on the ICE Futures exchange in London.
In other energy futures trading on the New York Mercantile Exchange:
- Wholesale gasoline was unchanged, ending at US$2.80 a gallon.
- Heating oil lost 2 cents to finish at US$3.03 a gallon.
- Natural gas fell 4 cents to end at US$3.20 per 1,000 cubic feet.
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