Crude oil futures - Weekly outlook: August 26 - 30 2013-08-25 11:29:42 GMT (Investing) Investing - New York-traded crude oil futures rallied more than 1% on Friday, after data showing that U.S. new home sales fell last month saw investors reassess expectations on when the Federal Reserve may start to unwind its asset purchase program. The Fed’s stimulus program is viewed by many investors as a key driver in boosting the price of commodities as it tends to depress the value of the dollar. On the New York Mercantile Exchange, light sweet crude futures for delivery in October rose 1.3% Friday to settle the week at USD106.37 a barrel by close of trade. The October contract settled up 1.15% at USD105.03 a barrel on Thursday. Oil futures were likely to find support at USD103.56 a barrel, the low from August 22 and near-term resistance at USD107.53 a barrel, the high from August 19. Despite Thursday’s and Friday’s strong gains, Nymex oil futures still ended 0.85% lower on the week as ongoing uncertainty over the timing of the Fed’s widely expected reduction in monthly bond purchases weighed. The Commerce Department said Friday U.S. new home sales fell by a larger-than-forecast 13.4% in July, the biggest decline in more than three years. Analysts had expected U.S. new home sales to fall by 2% last month. The data came amid ongoing speculation over whether the Fed will start to scale back its USD85 billion-a-month asset purchase program in September. Wednesday’s minutes of the Fed’s July meeting showed that officials were "broadly comfortable" with plans to reduce asset purchases, but divisions over the timing of possible tapering remain, with almost all committee members agreeing that a change in the purchase program was not yet appropriate. The minutes also described recent U.S. economic data as “mixed “, indicating that plans to taper could be pushed back if the economy was to weaken. Mounting concerns over turmoil in the Middle East and North Africa boosted prices as well. Countries in the region were responsible for 36% of global oil production and held 52% of proved reserves in 2012. The October contract rallied on Thursday as the release of unexpectedly strong manufacturing data out of the euro zone and China boosted oil demand expectations. In the week ahead, investors will be looking ahead to revised data on U.S. second quarter growth, as well as reports on the housing sector and consumer confidence. Oil traders have closely been looking out for U.S. data reports recently to gauge if they will strengthen or weaken the case for the Fed to reduce its bond purchases. Any improvement in the U.S. economy was likely to reinforce the view that the central bank will begin to taper its bond purchase program in the coming months. The U.S. is the world’s biggest oil consuming country, responsible for almost 22% of global oil demand. Elsewhere, on the ICE Futures Exchange in London, Brent oil futures for October delivery rose 1.05% on Friday to settle the week at USD111.07 a barrel. Earlier in the session Brent prices hit USD111.21 a barrel, the highest level since April 2. The London-traded Brent contract added 0.35% over the week, while the spread between the Brent and the crude contracts stood at USD4.70 a barrel by close of trade on Friday.
Posted on: Sun, 25 Aug 2013 13:16:33 +0000
Trending Topics
Recently Viewed Topics
© 2015