U.S. crude oil settled higher Thursday, as demand growth concerns eased with some positive manufacturing data out of China, the world’s second largest energy consumer. Oil prices also reacted to some upbeat macroeconomic data out of the U.S., but surrendered some of the gains just before close of trade on the Energy Information Administration report that showed crude oil stockpiles in the U.S. to have moved up last week.
The U.S. Energy Information Administration’s weekly crude oil report showed crude oil stockpile in the country increased by 2.80 million barrels to 363.10 million barrels last week, well above the upper limit of the average range for this time of year. Analysts expected crude oil inventories to rise 2.00 million barrels for the week. In the previous week, crude oil inventories dropped 1.00 million barrels to 360.30 million barrels.
Total motor gasoline inventories moved down by 1.70 million barrels last week, after increasing by 1.90 million barrels in the prior week, but well above the upper limit of the average range. Analysts estimated gasoline stocks to increase 1.60 million barrels last week.
Light Sweet Crude Oil futures for March delivery, the most actively traded contract, gained $0.72 or 0.8 percent, to close at $95.95 a barrel on the New York Mercantile Exchange Thursday.
Crude prices for March delivery scaled a high of $96.68 a barrel intraday and a low of $95.12.
China’s manufacturing sector activity rose to its highest level in two years in January as factory production picked up momentum, preliminary results of a survey by Markit Economics showed. The headline HSBC/Markit purchasing managers’ index rose to 51.9 in January from 51.5 in December. A PMI reading above 50 indicates expansion of the sector.
Yesterday, crude oil settled lower ahead of the inventory data from the American Petroleum Institute which showed U.S. crude oil inventories to have jumped 3.2 million barrels while gasoline stocks shed 1.60 million barrels in the week-ended January 18. Oil prices were also impacted with the dollar climbing, making commodities like oil, traded internationally in dollar, costlier to buyers holding other currencies.
The dollar index, which tracks the U.S. unit against six major currencies, traded at 79.94 on Thursday, down from 79.96 late Wednesday in North American trade. The dollar scaled a high of 80.15 intraday and a low of 79.86.
The euro traded lower against the dollar at $1.3371 on Thursday, as compared to $1.3318 on Wednesday in North America. The euro scaled a high of $1.3392 intraday and a low of $1.3288.
In economic news, a U.S. Labor Department report showed initial jobless claims to have dipped to 330,000, a decrease of 5,000 from the previous week’s unrevised figure of 335,000. The drop was a surprise, as economists expected jobless claims to climb to 355,000.
The Conference Board said its leading economic index rose by 0.5 percent in December after coming in unchanged in November. Economists had expected the index to increase by about 0.4 percent. This would suggest a pickup in domestic growth is now more likely than a few months ago.
In economic news from the eurozone, Germany’s private sector expanded at the fastest pace in a year underpinned by strong services activity, flash estimate from Markit Economics showed. The Composite Output Index came at 53.6 in January, up from 50.3 in December. A reading above 50 suggests expansion in the private sector. The Purchasing Managers’ Index for services climbed to a 19-month high of 55.3, up from 52 in December. The reading was forecast to remain unchanged at 52.
The euro area private sector activity contracted in January, but at a slower than expected pace, survey data from Markit Economics showed. The composite output index rose to a 10-month high of 48.2 in January from 47.2 in December. Economists had forecast the reading to rise to 47.5.
Separately the eurozone current account surplus increased to 14.8 billion euros in November from 8 billion euros in October, a European Central Bank report showed.
by RTT Staff Writer
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