WSJ:OIL FUTURES: Crude Remain Positive, Action On Europe Crisis Expected
Of DOW JONES NEWSWIRES
TOKYO (Dow Jones)--Crude oil futures stayed mostly in positive territory in Asia on Monday as traders were optimistic that progress on tackling the euro zone debt crisis could avert a slowdown in the global economy.
On the New York Mercantile Exchange, light, sweet crude futures for delivery in November traded at $87.19 a barrel at 0607 GMT, up $0.39 in the Globex electronic session. December Brent crude on London's ICE Futures exchange rose $0.10 to $112.33 a barrel.
Finance officials from the G-20 industrialized and developing nations said at the end of their meeting on Saturday that they expect an Oct. 23 meeting of European leaders "to decisively address the current challenges through a comprehensive plan."
Though the statement can be "interpreted in various ways," the market may be supported by expectations that the global economy could avoid "a second dip," Ken Koyama, Director of the Strategy and Industry Research Unit at The Institute of Energy Economics, Japan, said in a note released Monday.
Still, many analysts, including Koyama, point out that crude prices may drop sharply if European leaders fail to take decisive action soon.
Traders "need to keep watch to see if euro zone countries really come up with a concrete plan," said Tomomichi Akuta, analyst of Mitsubishi UFJ Research & Consulting.
Tom Pawlicki, analyst at MF Global Research, said "markets are unlikely to have the patience" to wait for long.
If investors sense any unwillingness by European leaders to strike a deal, "we'll see a massive sell-off," said Koichi Murakami, analyst at Tokyo-based broker Daiichi Shohin.
Besides the euro zone debt crisis, China's July-September GDP, and U.S. CPI and housing starts for September, due later this week, will be in focus, analysts said.
Nymex reformulated gasoline blendstock for November--the benchmark gasoline contract--rose 74 points to $2.8321 a gallon, while November heating oil traded at $3.0620, 62 points higher.
ICE gasoil for November changed hands at $956.50 a metric ton, up $4.50 from Friday's settlement.
-By Mari Iwata, Dow Jones Newswires; 813-6269-2798; mari.iwata@dowjones.com
