Saturday, March 13, 2010
Oil prices rises above 82 dollars a barrel
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LONDON: Crude oil prices rose on Friday, lifted by signs of firming demand as the world economy recovers from recession, analysts said.
New York's main contract, light sweet crude for April delivery, added 21 cents to 82.32 dollars a barrel.
London's Brent North Sea crude for April gained 17 cents to 80.45 dollars per barrel.
"There is a general consensus that the global economy is growing," said Victor Shum, an analyst with energy consultancy Purvin and Gertz in Singapore.
"What has also helped the bullish sentiment is the US oil inventory report," he added.
"Market participants are bullish at this point based on economic recovery optimism and are thinking ahead about the summer driving season raising gasoline demand in the US."
The upcoming driving season, which starts in May, sees gasoline or petrol demand hit a peak as many Americans hit the roads for holiday trips.
The US Department of Energy's weekly oil inventory report Wednesday showed a surprise drop in gasoline stockpiles, a key factor behind the large supply backlog, indicating strengthening demand.
Gasoline stockpiles tumbled 2.9 million barrels in the week to March 5, surprising the market as most analysts had expected an increase of about 100,000 barrels.
Distillates reserves, which include diesel and heating fuel, slumped by 2.2 million barrels. That was far more than predictions of a 700,000-barrel drop.
US crude oil inventories meanwhile climbed 1.4 million barrels, which undershot analysts' consensus forecast for a 1.7-million-barrel gain.
The market is also awaiting next week's oil output meeting of the Organisation of Petroleum Exporting Countries (OPEC), analysts said.
OPEC anticipates no change in oil production quotas at its next meeting, the cartel's head said on Thursday, predicting prices would remain within a 70 to 80 dollar range.
"At the next OPEC meeting, changes in policy will not be necessary," said Ecuadoran Oil Minister Germanico Pinto, the cartel's president, referring to the upcoming gathering on March 17 in Vienna.
He added that the US and global economic recoveries will result in increased demand for oil, but that it would not be reflected in higher prices.
Instead, he said prices would remain stable at a "reasonable level" of between 70 and 80 dollars a barrel.
OPEC's production ceiling was set at 24.8 million barrels a day in January 2009 after oil prices collapsed in the wake of the global economic crisis, and Pinto stressed it would remain unchanged.
New York's main contract, light sweet crude for April delivery, added 21 cents to 82.32 dollars a barrel.
London's Brent North Sea crude for April gained 17 cents to 80.45 dollars per barrel.
"There is a general consensus that the global economy is growing," said Victor Shum, an analyst with energy consultancy Purvin and Gertz in Singapore.
"What has also helped the bullish sentiment is the US oil inventory report," he added.
"Market participants are bullish at this point based on economic recovery optimism and are thinking ahead about the summer driving season raising gasoline demand in the US."
The upcoming driving season, which starts in May, sees gasoline or petrol demand hit a peak as many Americans hit the roads for holiday trips.
The US Department of Energy's weekly oil inventory report Wednesday showed a surprise drop in gasoline stockpiles, a key factor behind the large supply backlog, indicating strengthening demand.
Gasoline stockpiles tumbled 2.9 million barrels in the week to March 5, surprising the market as most analysts had expected an increase of about 100,000 barrels.
Distillates reserves, which include diesel and heating fuel, slumped by 2.2 million barrels. That was far more than predictions of a 700,000-barrel drop.
US crude oil inventories meanwhile climbed 1.4 million barrels, which undershot analysts' consensus forecast for a 1.7-million-barrel gain.
The market is also awaiting next week's oil output meeting of the Organisation of Petroleum Exporting Countries (OPEC), analysts said.
OPEC anticipates no change in oil production quotas at its next meeting, the cartel's head said on Thursday, predicting prices would remain within a 70 to 80 dollar range.
"At the next OPEC meeting, changes in policy will not be necessary," said Ecuadoran Oil Minister Germanico Pinto, the cartel's president, referring to the upcoming gathering on March 17 in Vienna.
He added that the US and global economic recoveries will result in increased demand for oil, but that it would not be reflected in higher prices.
Instead, he said prices would remain stable at a "reasonable level" of between 70 and 80 dollars a barrel.
OPEC's production ceiling was set at 24.8 million barrels a day in January 2009 after oil prices collapsed in the wake of the global economic crisis, and Pinto stressed it would remain unchanged.
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