Crude Oil Steady on Weaker USD
Source: Bloomberg, Moming Zhou (9/28/10)
"The weaker dollar is one of the things driving the price back up."
Crude erased an earlier loss as the dollar declined after the Conference Board, a private research group in New York, said its confidence index fell to 48.5 in September from 53.2 the prior month. The median estimate of economists in a Bloomberg News survey was for a drop to 52.1.
"The weaker dollar is one of the things driving the price back up," said Chris Barber, a senior analyst at Energy Security Analysis Inc. in Wakefield, Massachusetts. "The market is waiting for concrete evidence of demand coming back."
Crude for November delivery rose $0.14 to $76.66 a barrel at 12:14 p.m. on the NYMEX. The trading range was $75.53 to $77.12.
The dollar fell 0.9% to $1.357 against the euro in New York. It touched $1.3583, the weakest level since April 16.
Oil fell earlier before an Energy Department report tomorrow that may show gasoline stockpiles climbed 350,000 barrels last week, according to the median of 14 analyst estimates compiled by Bloomberg. Stockpiles rose to 226.1 million barrels in the week ended Sept. 17, the highest level since March 12.
"People are looking ahead to the stats tomorrow, and we should expect another build in gasoline," said Carl Larry, president of Oil Outlooks & Opinions LLC in Houston. "There is a lot of oil in inventory right now and prices are going to have a hard time to stay up."
Total petroleum supplies, including crude oil and fuel, climbed to 1.14 billion barrels in the week ended Sept. 17, the highest since at least 1990, according to the department. Total consumption of petroleum products fell 1.8% that week.