WSJ:OIL FUTURES: Crude Mixed; Tropical Storm Don In Focus
SINGAPORE (Dow Jones)--Crude-oil futures were mixed in Asia Thursday, with prices off lows hit in early trading as the market turned its focus to Tropical Storm Don, which was heading towards the central Gulf of Mexico late Wednesday.
On the New York Mercantile Exchange, light, sweet crude futures for delivery in September traded at $97.20 a barrel at 0636 GMT, down $0.20 in the Globex electronic session. September Brent crude on London's ICE Futures exchange rose $0.19 to $117.62 a barrel.
Tropical Storm Don is moving east-southeast across the Gulf of Mexico on a path that could affect several platforms in the Gulf of Mexico and has prompted six oil producers to evacuate non-essential personnel.
The U.S. National Hurricane Center said in an advisory the storm, with maximum sustained winds of about 40 miles per hour as of 0600 Thursday GMT, is moving toward the west-northwest at about 9 mph, 3 mph slower than stated in an earlier advisory.
"I think the [oil] market is more worried about the U.S. debt ceiling issue than the storm," Tokyo-based fund manager Tomohisa Okada at Astmax Co said.
Crude futures are expected to trade sideways in the next few sessions due to an impasse in the U.S. debt ceiling talks, Jim Ritterbusch, head of oil advisory firm Ritterbusch & Associates, said in a note to investors.
"Overall, a continued choppy, sideways trading environment should be anticipated as the market attempts to discount the outcome of the ongoing debt ceiling talks."
He expects an upside in WTI and Brent prices once the debt issue is resolved, tipping them to reach $103 a barrel and $122 a barrel, respectively.
MF Global has suspended its long recommendation on crude after an overnight rise in U.S. crude stocks. The Energy Information Administration indicated stocks rose 2.3 million barrels last week compared with a forecast for a drop of 1.4 million barrels by analysts surveyed by Dow Jones Newswires.
"Yesterday's selloff stopped us out of our long recommendation in crude oil at our $98-a-barrel entry point," analyst Tom Pawlicki said. "We favor standing aside or even looking for further weakness in today's session."
Nymex reformulated gasoline blendstock for August--the benchmark gasoline contract--rose 252 points to $3.1675 a gallon, while August heating oil traded at $3.0959, 133 points higher.
ICE gasoil for August changed hands at $971.75 a metric ton, down $2.75 from Wednesday's settlement.
