By Michael Kitchen, MarketWatch
LOS ANGELES (MarketWatch) — U.S. benchmark crude-oil futures fell in electronic trade Friday as the dollar changed direction and as a report said Washington could release some of its oil reserves to ease prices.
The September crude-oil contract CLU2 -0.49% fell 0.4%, or 37 cents, to $95.23, giving back gains from Thursday’s session on the New York Mercantile Exchange.
On Thursday, the benchmark Nymex contract had rallied 1.4% to a three-month high on dollar weakness and concerns of a possible Israeli airstrike on Iranian nuclear facilities. Read more on Thursday’s oil trade.
But the dollar rebounded Friday, with the ICE dollar index DXY -0.01% rising to 82.468 from 82.393 in the previous day’s North American trade. A stronger greenback tends to pressure dollar-denominated crude, making it more expensive for holders of other currencies.
Also weighing on oil, Reuters said in an anonymously sourced report late Thursday that the White House is “dusting off old plans” to release some stocks from the U.S. Strategic Petroleum Reserve to ease gasoline prices amid sanctions against Iran.
However, Citi Futures analysts were skeptical that such a move would come to fruition anytime soon.
“At this point, however, we’d rate this as more trial balloon than operative plan,” they said.
Given that U.S. commercial crude stocks are higher than a year ago and 8.2% above the five-year average, “we think it’s hard to argue that refiners lack feed,” they said, which also noting that such a move in an election year could face political backlash.
Elsewhere in the energy complex, September gasoline RBU2 -1.12% shed 3 cents or 1% to $3.05 a gallon, while September heating oil HOU2 -0.82% also fell 3 cents or 0.8% to $3.10 a gallon.
Natural gas for September NGU2 +0.07% was little changed at $2.72 per million British thermal units.
Michael Kitchen is Asia editor for MarketWatch and is based in Los Angeles.
