By Claudia Assis and Sarah Turner, MarketWatch
SAN FRANCISCO (MarketWatch) — Crude-oil futures added to gains on Thursday, garnering support from somewhat positive U.S. housing data, lingering geopolitical concerns and a weaker dollar.
Crude for September delivery CLU2 +0.93% rose 48 cents, or 0.5%, to $94.80 a barrel on the New York Mercantile Exchange, returning to a three-month high.
Natural-gas futures declined, as traders repeated the pattern of buying ahead of the inventories report just to get out of the trade after the data release, often regardless of its content. The report showed a smaller-than-expected increase in supplies.
Crude on Wednesday rose to its best since in May after the Department of Energy’s Wednesday update showed a larger-than-expected drop in crude stockpiles last week. Read more on Wednesday's oil move.
Greasing oil’s away, the U.S. dollar turned modestly lower on Thursday.
A stronger U.S. dollar tends to pressure dollar-denominated commodities as it makes them more expensive for holders of other currencies.
The ICE dollar index DXY -0.34% , a measure of the greenback against a basket of six major currencies, declined to 82.393 from 82.649 in late Wednesday.
Geopolitical worries also helped oil higher.
“With Saudi Arabia recommending its citizens to leave Lebanon yesterday, to the Israeli ambassador to the U.S. saying Israel would be willing to strike Iran’s nuclear facilities, unrest in the Middle East is increasing on several fronts,” said Matt Smith, analyst with Summit Energy in Kentucky.
The Commerce Department said earlier that housing starts fell 1.1% in July after a jump in June. Building permits rose 6.8% in July, the highest level since August 2008.
The Philadelphia Federal Reserve, however, announced manufacturing in the Philadelphia area was negative for the fourth straight month. The New York Fed reported a similarly negative reading on New York-area manufacturing in the previous session.
September gasoline RBU2 -0.19% retreated 2 cents, or 0.6%, to stand at $3.07 a gallon, while September heating oil HOU2 +0.23% gained less than 1 cent, or 0.3%, to $3.09 a gallon.
Natural gas for September delivery NGU2 +1.71% declined 2 cents, or 0.8%, to $2.73 per million British thermal units. It traded at $2.76 per million Btus moments before the data release, and added to gains immediately after the report.
The Energy Information Administration reported an increase of 20 billion cubic feet, compared to analyst expectations hovering around 24 bcf.
The increase was supportive, it may not have been “enough of a bullish surprise to produce a robust price recovery,” said Tim Evans, an analyst with Citi Futures Perspective, in a note to clients.
“Although the data does imply a somewhat tighter supply/demand balance, moderate temperatures in the weeks ahead will allow for more robust rates of injection going forward,” he added.
Claudia Assis is a San Francisco-based reporter for MarketWatch.
Sarah Turner is MarketWatch's bureau chief in Sydney.
