Crude oil futures moved higher on Tuesday to trade just below the previous session’s nine-month top, after data showed that U.S. housing starts surged in May. Investors now looked ahead to the Federal Open Market Committee policy decision Wednesday as well as the release of key U.S. weekly supply data to gauge the strength of oil demand from the world’s largest consumer. On the New York Mercantile Exchange, light sweet crude futures for delivery in August traded at USD98.55 a barrel during U.S. morning trade, up 0.55% on the day. New York-traded oil prices held in a range between USD97.66 a barrel, the daily low and a session high of USD98.67 a barrel. Nymex oil prices rallied to hit USD98.94 a barrel on Monday, the strongest level since September 17, as mounting concerns over a disruption to supplies from the Middle East boosted prices. The Commerce Department said U.S. housing starts rose by 6.8% last month to hit a seasonally adjusted 0.914 million, below expectations for an increase of 11.4% to 0.950 million. The data also showed that the number of building permits issued in the U.S. fell 3.1% in May to a seasonally adjusted 0.974 million, worse than expectations for a decline of 2.8% to 0.975 million units. A separate report from the Labor Department said U.S. consumer price inflation rose 1.4% from a year earlier in May, in line with forecasts and up from 1.1% in April. Core inflation, which excludes food and energy costs, rose 0.2% in May, also in line with expectations. Consumer prices rose 0.1% in May from a month earlier, slightly below expectations for a 0.2% increase. But gains were limited as market players remained cautious amid speculation over whether the Fed will begin to scale back its easing program after Chairman Ben Bernanke said last month the bank could begin to taper asset purchases if the economy continued to improve. Attention will focus on Bernanke’s press conference on Wednesday, which investors are hoping will provide further clues on how long the central bank will maintain its USD85-billion-a-month in bond purchases. Oil traders also looked ahead to the release of fresh weekly information on U.S. stockpiles of crude and refined products to gauge the strength of oil demand in the world’s largest oil consumer. The American Petroleum Institute will release its inventories report later in the day, while Wednesday’s government report could show crude stockpiles fell by 0.6 million barrels. 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, Brent oil futures for August delivery rose 0.65% to trade at USD106.15 a barrel, with the spread between the Brent and crude contracts standing at USD7.60 a barrel. London-traded Brent prices hit a ten-week high of USD106.63 a barrel on Monday.
Posted on: Tue, 18 Jun 2013 14:26:54 +0000
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