MW: Oil futures rebound as equities gain, dollar falls
Oil futures rose Tuesday after tumbling nearly 8% in the previous session, as dollar weakness and gains in U.S. stock futures fueled a rebound in energy prices.
Crude oil for May delivery rose $1.12, or 2.3%, to $49.53 a barrel in electronic trading on Globex.
"We said last week that the prior increase above $50 was largely driven by the financial markets and sentiment, based on hopes that demand would pick up again later on in the year," said analysts at Commerzbank.
"From a short-term perspective, though, the fundamentals remain difficult, meaning that oil prices were vulnerable to setbacks as witnessed right now," they said.
On Monday, oil plunged 7.6%, marking the biggest one-day loss in nearly a month on rekindled concerns that a slow recovery in global growth will continue to weigh on energy demand.
U.S. stock futures posted gains Tuesday ahead of the release of consumer confidence data, though the broader market is on course to post a double-digit percentage loss for the quarter. See Indications.
The U.S. dollar fell versus most major currencies other than the Japanese yen, pressed by light position-squaring and a bounce in equity markets.
The dollar index , a measure of the greenback against a trade-weighted basket of six major currencies, slipped to 85.15, down from 85.712 in late North American trading Monday. See Currencies.
The U.S. Energy Information Administration (EIA) will release its closely watched data on petroleum supplies at 10:30 a.m. Eastern on Wednesday. The American Petroleum Institute will release a separate report on Tuesday afternoon.
Analysts expect that U.S. commercial crude stocks rose 3.2 million barrels during the week ended March 27, a Platts survey showed. They also project a decline in gasoline stocks of 1.8 million barrels as well as a decrease of 1.4 million barrels in distillate supplies.
Also on Globex, May reformulated gasoline rose 3 cents to $1.42 a gallon and May heating oil gained 3 cents to $1.38 a gallon. May natural gas futures rose 4 cents to $3.78 per million British thermal units.
