MW: Crude futures fall as consumer sentiment drops
By Claudia Assis and Kate Gibson, MarketWatch
SAN FRANCISCO (MarketWatch) -- Crude-oil futures declined Friday, pulling back 1% as a gauge of U.S. consumers' sentiment dropped sharply and as a string of disappointing corporate earnings pushed stocks on Wall Street broadly lower.
Crude for August delivery lost 75 cents to stand at $75.85 a barrel on the New York Mercantile Exchange.
Prices had veered between gains and losses in early trading, bolstered by a weaker dollar and prospects that energy demand would rise as the global economy recovers, even as investors have posed fresh questions about the health of the rebound.
A drop reported in consumer sentiment pushed prices decisively lower, however. The University of Michigan/Reuters consumer index fell to 66.5 this month from 76 in June, a drop much bigger than economists had been looking for.
Oil has lost 0.3% so far this week, a stark contrast with a stellar performance last week, when prices gained 5.5% -- oil's best since late May.
Other energy prices tracked oil lower on Friday, with reformulated gasoline for August delivery down 2 cents, or 0.8%, to $2.04 a gallon. On the week, gasoline futures have lost 1.5%.
August natural gas took a breather from rallying 7% on Thursday. Prices lost 5 cents, or 1%, to $4.55 per million British thermal units.
Thursday's sky-high gains, however, were being enough to secure a 3.4% weekly gain for natural gas. The commodity lost 6.8% the week before.
A weaker dollar was providing some floor for energy products. The dollar index (DXY 82.51, -0.05, -0.06%) , which tracks the performance of the U.S. unit against six other major currencies, was off 0.2% at 82.38.
A softer dollar is usually positive for oil and other commodities priced in the U.S. currency, as it makes them less costly for holders of other currencies and increases their appeal as investments.
Earlier, traders contended with a report showing tame inflation in the U.S.
Also on energy traders' radar screens were the latest developments involving BP PLC (BP 37.58, -1.34, -3.44%) and efforts to stanch the flow of oil from its stricken well at the bottom of the Gulf of Mexico. See related story.
Investors held their collective breath over initial signs of progress in stemming the flow, nearly three months after the explosion and sinking of the Deepwater Horizon drilling rig.
The British oil company said it stopped the flow Thursday but wouldn't know whether the latest containment cap would hold until a day or two later. Efforts to drill relief wells to permanently stop the gusher continue.
