BLBG:Crude Oil Declines for Second Day as Rising Dollar Counters Storm Concerns
Oil fell for a second day in New York as a rising dollar undermined the appeal of commodities, offsetting concerns that storms in the Gulf of Mexico will limit the supply of crude.
Crude declined as much as 0.9 percent, paring this week’s gain, as the dollar headed for its biggest weekly advance against the euro in four months. Companies including BP Plc removed staff in the Gulf, home to 27 percent of U.S. oil output. Prices dropped yesterday after Federal Reserve Chairman Ben S. Bernanke stopped short of specifying measures the U.S. may use to bolster growth when policy makers meet this month.
“The macro-economic data looks more bleak, and so the demand side is acting as a capping mechanism,” said Andy Sommer, a senior trader at EGL AG in Dietikon, Switzerland, who predicts Brent will end the year at about $115 a barrel.
Crude for October delivery declined as much as 78 cents to $88.27 a barrel in electronic trading on the New York Mercantile Exchange and was at $88.49 at 9:50 a.m. London time. Prices are up 2.4 percent this week and 19 percent from a year ago. Brent for October was at $114.49, down 6 cents, on London’s ICE Futures Europe exchange.
The euro traded at $1.3862 at 9:08 a.m. in London from $1.3882 in New York yesterday. The U.S. currency has advanced 2.4 percent over the past five days and it set for the biggest weekly increase since May 6.
Tropical Storm Nate is expected to become the third hurricane of the Atlantic season today. Top winds are 70 miles (113 kilometers) per hour, just under the threshold of 74 mph needed to be upgraded, according to an advisory from the U.S. National Hurricane Center before 1 a.m. Central Daylight Time.
BP and Apache Corp. said they were beginning evacuations of some workers in the Gulf because of Nate. The BP decision affects non-essential workers at the Atlantis, Holstein and Mad Dog platforms, according to a message on a telephone hotline. Apache’s removal of non-essential workers from facilities in the far western Gulf hasn’t affected production, Bill Mintz, a company spokesman, said in an e-mail.
To contact the reporters on this story: Ben Sharples in Melbourne at bsharples@bloomberg.net; Grant Smith in London at gsmith52@bloomberg.net
To contact the editor responsible for this story: Stephen Voss on sev@bloomberg.net
