Monday, May 10, 2010

Crude Rebounds After Four-Day Skid

NEW YORK—Crude-oil futures roared higher after four days of losses, reacting to a €750 billion ($955 billion) rescue package for the euro-zone economies and on reduced oil supply from the U.K.

Light, sweet crude oil for June delivery on the New York Mercantile Exchange was 2.3%, or $1.70, higher at $76.81 a barrel in noon trade. It traded in a range of $75.80 to $78.51 a barrel.

Crude lost $11 a barrel, or 13%, in a four-day rout last week on concerns over euro-zone sovereign debt and growing oil stockpiles. It settled Friday at the lowest level since Feb. 12.
Crude oil prices rebounded Monday after a four-day skid. Above, oil pumpjacks, operate at a state-owned Cupet facility along the northern coast of Cuba.
.ICE Brent crude futures for June were up $1.85 at $80.12 a barrel, after settling Friday at the lowest level since March 15.

A rescue package agreed to by the European Commission, European governments and the International Monetary Fund over the weekend perked up the euro against the dollar and sought to staunch concerns over a growing debt problem across the euro zone. The weaker dollar stirred buyers for crude oil, as investors in foreign currencies find oil relatively cheap when the dollar is down.

Traders said news that maintenance in the North Sea Brent oil field in the U.K. will cut June supplies by about one-third of May levels also lent support. But the market remains well-supplied, a situation acknowledged by some Arab members of the Organization of Petroleum Exporting Countries at a Qatari oil conference.

Still OPEC's Secretary General Abdullah Salem El-Badri said OPEC wouldn't review its current attempts at restraining oil output before a scheduled October meeting. He said OPEC would have to live with price volatility. Still Kuwait's oil minister said a drop below $65 a barrel could force OPEC to act.

Some traders were skeptical that the rebound was the start of a full recovery and await real signs of returning stability in Europe. "This huge upswing could also offer a great selling opportunity at some point during the day," said Phil Flynn, an analyst at PFGBest in Chicago.

June reformulated gasoline blendstock was up 4.40 cents at $2.1691 a gallon recently after shedding 31 cents in the four-day selloff. June heating oil was 3.94 cents higher at $2.1189 a gallon, after dropping 26.6 cents in the past four days.

Write to David Bird at

No comments:

Post a Comment