Data show an upward revision in U.S. fourth-quarter GDP growth
By Polya Lesova and Sarah Turner, MarketWatch
LONDON (MarketWatch) — Oil futures were little changed Friday, trading above $105 a barrel, as investors digested an upward revision to U.S. growth and eyed political unrest in the Mideast.
Crude oil for May delivery (CLK11 105.59, -0.01, -0.01%) gained 1 cent to $105.61 a barrel in electronic trading on the New York Mercantile Exchange.
Futures showed little reaction to data showing that U.S. real gross- domestic-product data for the fourth quarter were revised to an increase of 3.1% annualized from an earlier estimate of a 2.8% rise.
The May crude contract closed down 15 cents at $105.60 a barrel in New York on Thursday.
“Continued fighting in Libya and protests in other Arab countries have given further support to oil prices, though additional impulses are currently lacking for any further rise of prices,” Commerzbank said in a note.
Edward Meir, senior commodity analyst at MF Global, said that recently “[investors have been] bidding prices higher mainly on the back of geopolitical headlines.”
One of the latest developments has seen members of the North Atlantic Treaty Organization, or NATO, reportedly reach an agreement to take over enforcement of the United Nations-sanctioned no-fly zone over Libya.
NATO will assume enforcement of the no-fly zone from a coalition led by Britain, France and the United States within days, according to reports which cited NATO Secretary-General Anders Fogh Rasmussen.
Meir at MF Global noted that expectations that Japanese oil demand will bounce back after a recent earthquake and tsunami devastated the country are also providing a bit of support for oil prices.
Still, he cautioned that Japanese oil imports are likely running at much less than their pre-quake levels of 4.2 million barrels a day and data suggest an extra 0.7 million to 1.2 million tons of extra oil is on the market right now.
“At this point in time, investors are not bothering with running the numbers,” he said.
However, if the market starts to discount a longer-than-expected time frame to get power facilities back on track that “should temper expectations that Japanese commodity demand will undergo a vigorous snap-back,” he said.
