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Oil below $86 amid weak indicators, earnings

Oil below $86 amid weak indicators, earnings

Oil prices hovered below $86 a barrel Friday, dragged lower by high U.S. inventories and weak economic and earnings news.
By early afternoon in Europe, benchmark crude for March delivery was up 1 cent at $85.65 a barrel at late afternoon Bangkok time in electronic trading on the New York Mercantile Exchange.
The contract lost $1.69 to settle at $85.64 a barrel on Thursday and is down from nearly $93 a barrel last week as evidence accumulated that demand isn't strong enough to sustain crude prices at those levels.
That the U.S. recovery faces possible hurdles was underlined by weak growth in durable goods orders for December and a rise in the number of Americans applying for unemployment benefits last week.
Meanwhile U.S. companies that are bellwethers for consumer spending reported disappointing earnings.
Amazon.com uncharacteristically missed Wall Street's revenue target. Both Procter & Gamble Co. and rival Colgate-Palmolive Co. reported lower profits.
Those indicators came ahead of the release later Friday of growth figures for the October-December quarter.
This week's release data from the U.S. Energy Department said supplies of oil and gasoline rose more than expected last week.
"The market could fall toward the $82 a barrel ... as indications of strong supplies and moderate demand remain in place," said a report from Tom Pawlicki at MF Global in Chicago.
In other Nymex trading for February contracts, heating oil rose 1.61 cents to $2.6707 a gallon and gasoline added 1.84 cents to $2.40 a gallon. Natural gas futures for March delivery fell 5.3 cents to $4.266 per 1,000 cubic feet.
In London, Brent crude was up 44 cents at $97.83 on the ICE futures exchange.
"The biggest mystery on the oil market remains the remarkably wide price gap between the two main benchmark types of crude oil, WTI and Brent," said analysts at Commerzbank in Frankfurt, referring to West Texas Intermediate, the type of oil used as a U.S. benchmark. "We believe that both prices are distorted at present, WTI to the downside and Brent to the upside."


Updated : 2021-05-07 16:38 GMT+08:00