Crude Oil Rises for First Time in Six Days
Source: Bloomberg, Grant Smith (7/6/10)
"Risk appetite is improving with higher equities."
Crude reversed earlier losses of as much as 1.5% as European equity indexes climbed the most in a month. The industry-funded American Petroleum Institute will release its weekly report on fuel supply and demand levels tomorrow, a day later than normal because of yesterday's Independence Day holiday in the U.S.
"Risk appetite is improving with higher equities," said Andrey Kryuchenkov, an analyst with VTB Capital in London. "There's a close correlation between crude and the dollar, and that explains the small rebound today, but I'd be careful about buying here as we'll likely remain in a narrow trading range."
The contract for August delivery gained as much as $1.08, or 1.5%, to $73.22 a barrel in electronic trading on the New York Mercantile Exchange, and traded for $73.16 at 1:34 p.m. London time. It earlier dropped as low as $71.09 a barrel. Brent crude for August was at $72.62 a barrel, $1.15 higher, on London's ICE Futures Europe exchange.
Floor trading was closed yesterday on the Nymex for the U.S. Independence Day holiday and electronic trades are booked today for settlement purposes.
Before today, the market had been in its longest pullback since a six-day drop through May 18. Crude oil retreated 8.5% in the six days through yesterday, bringing its decline this year to 9%.