The price of crude oil edged up Wednesday morning amid speculation that China, the commodity hungry nation, will opt more economic stimulus.
China's new Communist Party chief Xi Jinping set his economic agenda ahead of the party's central economic planning meeting this month. Urbanization is indicated to remain the engine for China's economic growth. Meanwhile, the China Insurance Regulatory Commission abolished a rule that limited the investments insurers can make in commercial banks.
Light Sweet Crude Oil (WTI) futures for January delivery, edged up $0.13 to $88.63 a barrel. Yesterday, oil settled lower on demand concerns as investors worried over the little progress made in the U.S. budget negotiations with the fiscal cliff due in about four weeks. The U.S. fiscal cliff involves $600 billion in spending cuts and tax increases set to begin in January, unless an agreement is reached between the Obama administration and the Republicans.
Tuesday after the market hours, the API said crude oil inventories fell 2.2 million barrels, while gasoline stocks rose 5.7 million barrels in the weekended November 30.
This morning, the U.S. dollar was lingering around its one month low versus the euro and sterling. The buck was hovering near its 7-month high versus the yen and trading flat against the Swiss franc.
In economic news, euro zone retail sales decreased for the third consecutive month in October, Eurostat said. Retail sales were down 1.2 percent in October from a month ago, when it dropped 0.6 percent. Sales were forecast to fall just 0.2 percent.
Meanwhile, survey results released by Markit Economics revealed that the euro area private sector contracted less than estimated in November. The composite output index, which measures the combined output of the manufacturing and service sectors, rose to 46.5 in November from 45.7 in October, final data showed. The flash reading was 45.8.
Traders will look to the private sector employment report from the ADP, due out at 815 a.m ET. Economists expect an addition of 125,000 jobs by the sector in November following an addition of 158,000 jobs in October.
Today during trading hours, the EIA will release its US crude oil inventories report for the weekended November 30. Analysts expect crude oil inventories to dip 1.25 million barrels, while gasoline stocks are seen adding 2 million barrels last week.
