Alexa
  • Directory of Taiwan

Oil moves above $101 ahead of US supply data

Oil moves above $101 ahead of US supply data

Oil prices moved above $101 a barrel Tuesday ahead of U.S. crude supply figures that will provide clues about the strength of demand in the world's largest economy.
By early afternoon in Europe, benchmark crude for March delivery was up 55 cents at $101.46 a barrel in electronic trading on the New York Mercantile Exchange. The contract rose $2.24 to settle at $100.91 on Monday.
In London, Brent crude was up 13 cents at $118.06 a barrel on the ICE Futures exchange.
Oil has hovered near $100 for several months amid signs the U.S. economy is improving. However, crude supplies have been rising, suggesting demand remains weak.
The oil market will be closely watching the latest inventory data when the American Petroleum Institute reports later Tuesday and the Energy Department's Energy Information Administration announces its weekly supply data _ the market benchmark _ on Wednesday.
Analysts surveyed by Platts, the energy information arm of McGraw-Hill Cos., predict crude inventories rose 1.9 million barrels last week.
Some analysts are concerned that rising U.S. gasoline prices, which hit a five-month high last week, could undermine consumer spending and economic growth.
"These price increases come at a difficult time for the economy," energy consultant Cameron Hanover said in a report. "Jobs are just starting to come back and housing is starting to breathe its first breaths of life in years, and gasoline prices are back at it, ready to scuttle economic recovery through a pervasive tax that catches everyone."
While oil prices fell earlier in the session as markets digested the credit rating downgrades of several European Union countries _ including Italy, Portugal and Spain _ the ongoing tensions between Iran and Israel kept crude well-supported.
"In the wake of two bomb attacks on Israeli embassy staff in India and Georgia, geopolitical tension in the Middle East is rising again," said analysts at JBC Energy in Vienna, who also listed sectarian conflicts in Saudi Arabia and Bahrein among the sources of risk.
"These incidents underpin the fact that supply jitters will be around for some time, given the volatile security situation in the region," JBC said.
In other energy trading, heating oil was up 0.79 cent at $3.1679 per gallon and gasoline futures slid 0.28 cent to $3.0097 per gallon. Natural gas gained 4.7 cents to $2.478 per 1,000 cubic feet.
___
Alex Kennedy in Singapore contributed to this report.