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Oil settles above US$70 as stock markets climb
Source: Agencies |
October 6, 2009, Tuesday
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OIL prices pushed through early losses to settle above US$70 a barrel yesterday on the coattails of strong equity markets and weakness in the US dollar.
"It still recognizes the favorable vibes that it's getting from the stock market, said Jim Ritterbusch, president of energy consultancy Ritterbusch and Associates.
Benchmark crude for November delivery gained 46 cents to settle at US$70.41 on the New York Mercantile Exchange.
Weak economic data weighed on crude prices last week. The US reported worse than expected manufacturing and jobs numbers, with the unemployment rate rising to 9.8 percent in September, the highest since 1983.
This week will feature a slew of third quarter company earnings reports that could hint at the health of the US economy.
PFGBest analyst Phil Flynn said swelling US crude supplies are staggering, but the dire state of the jobs market is also hitting the energy markets.
"Welcome to the jobless economic recovery that should reduce oil demand expectations even further as we look out into our future," Flynn said in his morning report.
Federal Reserve Chairman Ben Bernanke last week said that even though the recession is technically over, the US economy will feel weak for some time.
Analyst and trader Stephen Schork said he believes Bernanke.
"In other words, the residue of this recession will linger in the psyche of the American consumer - whose spending drives two-thirds of the US economy - for quite some time to come," Schork wrote in his morning report.
The oil markets also slipped on geopolitical news out of Nigeria, where a rebel leader accepted a government amnesty offer to disarm. Unrest in the country has cut its oil production by a million barrels a day, allowing Angola to overtake it as Africa's top oil producer.
Traders will eye the first earnings for the July-to-September period, with Aluminum producer Alcoa Inc., PepsiCo Inc. and Marriott International Inc. scheduled to report this week.
In other Nymex trading, heating oil fell 0.52 cent to settle at US$1.7916 a gallon. Gasoline for November delivery added 1.3 cents to settle at US$1.7539 a gallon. Natural gas for November delivery gained 26.9 cents to settle at US$4.987 per 1,000 cubic feet.
In London, Brent crude lost 3 cents to settle at US$68.04 on the ICE Futures exchange.
"It still recognizes the favorable vibes that it's getting from the stock market, said Jim Ritterbusch, president of energy consultancy Ritterbusch and Associates.
Benchmark crude for November delivery gained 46 cents to settle at US$70.41 on the New York Mercantile Exchange.
Weak economic data weighed on crude prices last week. The US reported worse than expected manufacturing and jobs numbers, with the unemployment rate rising to 9.8 percent in September, the highest since 1983.
This week will feature a slew of third quarter company earnings reports that could hint at the health of the US economy.
PFGBest analyst Phil Flynn said swelling US crude supplies are staggering, but the dire state of the jobs market is also hitting the energy markets.
"Welcome to the jobless economic recovery that should reduce oil demand expectations even further as we look out into our future," Flynn said in his morning report.
Federal Reserve Chairman Ben Bernanke last week said that even though the recession is technically over, the US economy will feel weak for some time.
Analyst and trader Stephen Schork said he believes Bernanke.
"In other words, the residue of this recession will linger in the psyche of the American consumer - whose spending drives two-thirds of the US economy - for quite some time to come," Schork wrote in his morning report.
The oil markets also slipped on geopolitical news out of Nigeria, where a rebel leader accepted a government amnesty offer to disarm. Unrest in the country has cut its oil production by a million barrels a day, allowing Angola to overtake it as Africa's top oil producer.
Traders will eye the first earnings for the July-to-September period, with Aluminum producer Alcoa Inc., PepsiCo Inc. and Marriott International Inc. scheduled to report this week.
In other Nymex trading, heating oil fell 0.52 cent to settle at US$1.7916 a gallon. Gasoline for November delivery added 1.3 cents to settle at US$1.7539 a gallon. Natural gas for November delivery gained 26.9 cents to settle at US$4.987 per 1,000 cubic feet.
In London, Brent crude lost 3 cents to settle at US$68.04 on the ICE Futures exchange.
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