Crude Oil Advances as European, U.K. Economic Data Boost Demand Optimism
Baku, April 27 (AZERTAC). Crude climbed after European economic data indicated demand may be recovering in the region, easing concern that oil prices near their highest in more than two years may be hurting growth.
Brent advanced as much as 0.7 percent after reports showed that industrial orders in the euro region gained for a fifth month in February, led by demand for capital goods, and that Britain`s economy rebounded in the first quarter as growth surged in the service industry. The dollar traded near a 16- month low against the euro and a two-year low against the pound, boosting the appeal of commodities priced in the U.S. currency.
“Both demand data and macroeconomic data continue to surprise to the upside and despite worries of slowdown from higher prices, we haven`t seen any effects yet,” Amrita Sen, a London-based oil analyst at Barclays Plc, said by e-mail. “That`s what is supporting prices.”
Brent for June settlement rose as much as 84 cents to $124.98 a barrel and was at $124.50 at 12:18 p.m. on the ICE Futures Europe Exchange in London. Crude in New York was up 39 cents at $112.64 a barrel after rising as much as 58 cents, or 0.5 percent, to $112.79.
Futures in New York fell earlier by as much as 0.5 percent after U.S. Treasury Secretary Timothy Geithner said oil prices have become an obstacle to economic growth. The U.S. Energy Department may say today that crude stockpiles in the country climbed even as gasoline supplies declined.
Oil`s rally has created “new headwinds” against economic growth, Geithner told the Council on Foreign Relations in New York yesterday, even as a Conference Board index showed consumer confidence increased more than forecast in April.
Brent traded at $127.02 a barrel on April 11, the highest level in more than 2 1/2 years, buoyed by concern that political unrest in Libya could spread to other producers including Algeria and Saudi Arabia.
Crude stockpiles climbed 1.7 million barrels from 357 million in the week ended April 22, according to the median estimate of 13 analysts surveyed. Gasoline stockpiles are expected to have decreased 1 million barrels from 208 million.
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