Oil prices inch up on dollar’s sliding fortunes




Crude oil futures rose slightly yesterday (Tuesday) as the United States (U.S.) dollar weakened, but any upside will likely be limited amid pessimism clouding the global economy and equity markets.On the New York Mercantile Exchange, light, sweet crude futures for delivery in September traded at $75.26 a barrel at 0653 GMT, up 2 cents in the Globex electronic session. October Brent crude on London’s ICE Futures exchange fell five cents to $75.58 a barrel.


The latest gains came as the dollar fell against the yen and the euro, as investors continued to shy away from the greenback.However, the oil market still lacks any significant upward momentum amid macroeconomic concerns and soft equity markets, according to analysts.Most stock markets in Asia traded mixed Tuesday, and the mood remained fragile with slowing global recovery, while the Tokyo market was again pressured by the yen’s strength.


“We still haven’t seen any strong evidence that the global economy is indeed recovering,” said Ken Hasegawa, an analyst at Newedge Japan.After recent disappointing gross domestic product figures from the U.S. and Japan, more economy reports due later today may provide more direction for equity and commodity markets.


The United Kingdom consumer price index is due at 0830 GMT, the eurozone current account at 0800 GMT and the German ZEW survey at 0900 GMT.In the US, the producer price index and housing starts data are due at 1230 GMT, while industrial production data are due at 1315 GMT.


Support is unlikely to come from fundamentals, however. Data on U.S. stockpiles from the Department of Energy due at 1430 GMT Wednesday are expected to show a meager drop for oil inventories of 1.4 million barrels, according to a survey of analysts by Dow Jones Newswires.Gasoline stocks are seen down 500,000 barrels, a modest draw during the important summer driving season, while distillates, which include heating oil and diesel fuel, are expected to rise by 700,000 barrels.


“Traders and investors saw a weakening economy and plentiful oil supplies as reasons not to be aggressive buyers when the euro rallied,” analysts at Cameron Hanover said in research note.Nymex reformulated gasoline blendstock for September- the benchmark gasoline contract, rose 81 points to 193.24 cents a gallon, while September heating oil traded at 199.35 cents, 47 points higher.ICE gasoil for September changed hands at $635.50 a metric ton, up $2.50 from last settlement.






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