Oil fell, reversing earlier gains, before reports this week from the U.S. and Europe forecast to indicate that the global recovery is losing momentum.
Data this week may show U.S. housing starts and building permits fell in July, while consumer prices rose the least in three months as unemployment restrained spending, according to surveys by Bloomberg News. The euro-zone economy probably expanded 0.3 percent in the second quarter, down from first- quarter growth of 0.8 percent. Hedge funds and other money managers cut bullish bets on Brent crude by 49 percent in the week ended Aug. 9, according to ICE Futures Europe.
“It’s unlikely we’ll see a pronounced rebound in crude prices here as fears over a global economic slowdown are still rife,” said Andrey Kryuchenkov, an analyst at VTB Capital in London.
Crude for September delivery fell as much as 98 cents, or 1.2 percent, to $84.40 a barrel in electronic trading on the New York Mercantile Exchange and was at $84.98 at 12:33 p.m. London time. Earlier it climbed to $85.82. Brent oil for September settlement was at $107.83, down 20 cents, on the London-based ICE Futures Europe.
The European benchmark was at a premium of $22.84 to U.S. futures, compared with a record close of $23.79 on Aug. 10.
Speculative bets that Brent will rise, in futures and options combined, outnumbered short positions by 95,871 contracts, the London-based exchange said today in its weekly Commitment of Traders report. Net-long positions fell by 47,019 contracts from 95,871 a week earlier.
Tropical Storm
Tropical Storm Gert is expected to pass near Bermuda today. The storm is about 105 miles (170 kilometers) southeast of the Caribbean island and is moving north at 14 miles an hour. It has maximum sustained winds of 60 miles an hour, the Miami-based center said in an advisory issued at 5 a.m. Bermuda time, and these extend up to 70 miles, mostly to the north and east.
Hedge funds cut bullish bets on New York crude to the lowest level in more than eight months in the week ended Aug. 9, according to a report last week. The funds and other large speculators reduced their net-long positions, or wagers that prices will rise, by 11 percent, according to the Commodity Futures Trading Commission’s weekly Commitments of Traders report.
To contact the reporter on this story: Grant Smith in London at gsmith52@bloomberg.net
To contact the editor responsible for this story: Stephen Voss at sev@bloomberg.net
