WSJ:OIL FUTURES: Nymex Crude Falls in Asia Despite Bullish US Stocks Data
By Gurdeep Singh
Crude-oil prices were lower in Asia Friday on a stronger U.S. dollar and weaker sentiment after the market failed to rally on bullish U.S. inventory data as well as an announcement of fresh measures by the European Central Bank to stimulate the region's economy.
On the New York Mercantile Exchange, light, sweet crude futures for delivery in October traded at $95.37 a barrel at 0701 GMT, down $0.16 in the Globex electronic session. October Brent crude on London's ICE Futures exchange rose $0.10 to $113.59 a barrel.
U.S. crude stockpiles plunged 7.4 million barrels last week, the biggest one-week drop in inventories since December.
But traders were already "expecting a large draw, given production shutdowns in the Gulf of Mexico region" due to Hurricane Isaac, said Stephen Schork, author of the Schork Report. "In turn, traders weren't fooled, and prices were actually trending lower in the minutes after the report's release," he said.
Meanwhile, ECB President Mario Draghi Thursday presented a plan to tackle Europe's ongoing debt crisis which sparked a rally in global equities but failed to excite the oil markets.
The plan allows the ECB to buy the bonds of troubled euro-zone governments in the secondary market in order to lower their borrowing costs. The central bank plans to purchase bonds with maturities of between one and three years, and it will also require the countries involved to agree to a euro-zone program of budgetary discipline.
"A lack of bullish response to a supportive ECB policy announcement and a larger-than-expected crude stock decline would appear to tilt the scales in favor of lower oil prices going forward," Jim Ritterbusch at Ritterbusch and Associates said in a note.
Oil traders remain cautious ahead of the release of U.S. nonfarm payrolls data due later in the global day.
"All eyes will be on the domestic non-farm payrolls report to see whether the dollar can claw back losses against the euro following the announcement of the ECB," Mr. Schork said.
Nymex reformulated gasoline blendstock for October--the benchmark gasoline contract--rose 45 points to $2.9955 a gallon, while October heating oil traded at $3.1462, 37 points higher.
ICE gasoil for September changed hands at $983.75 a metric ton, down $7.00 from Thursday's settlement.
Write to Gurdeep Singh at gurdeep.singh@dowjones.com
