WASHINGTON (Alliance News) - The price of crude oil was extending gains Wednesday morning on news that part of a major US pipeline could open next month and ease over-supplied inventories.
Light Sweet Crude Oil (WTI) futures for January delivery, gained USD1.29 to USD97.33 a barrel. Yesterday, oil gained over 2% as demand growth concerns eased after upbeat manufacturing data out of the US and China.
Tuesday after the market hours, the API said US crude oil inventories dropped by 12 million barrels and gasoline stocks shed 119,000 barrels in the weekended November 29.
This morning the US dollar was lingering around its monthly low versus the euro and near a two-year low against sterling. The buck was trading flat versus the yen, while ticking lower against the Swiss franc.
In economic news, euro zone's economic growth moderated in the third quarter in line with the preliminary estimate, detailed data released by Eurostat confirmed. The gross domestic product expanded 0.1% quarter-on-quarter in the third quarter after exiting the region's longest-ever recession in the second quarter with a GDP growth of 0.3%.
Meanwhile, retail sales in the euro area decreased for the second consecutive month in October, owing mainly to lower sales in the non-food sector, data released by statistical office Eurostat revealed. Retail sales volume decreased 0.2% month-on-month in October, following a 0.6% fall in September. Economists had forecast sale to stay unchanged in October.
Final data released by Markit Economics revealed euro zone's private sector economy expanded at a slightly faster rate than estimated earlier. The seasonally adjusted purchasing managers' index for the private sector economy dropped to 51.7 in November from 51.9 in October. However, the score was higher than the flash estimate of 51.5. The index has remained above the no-change 50 mark for the fifth consecutive month.
The German service sector expanded at a significantly faster pace in November, and the growth rate exceeded the preliminary estimates, final data from a survey conducted by Markit Economics and BME revealed. The seasonally adjusted purchasing managers' index for the service sector climbed to 55.7 in November from 52.9 in October, hitting a ten-month high. The revised score was above the earlier flash reading of 54.5. The index has now stayed above the no-change 50 mark, which separates growth from contraction, for the sixth successive month.
Traders will look to the US private sector employment report from the ADP. Economists expect private payroll gains of 185,000 for November, up from 130,000 for October.
The Commerce Department is due to release its trade balance report for October at 8:30 am ET. The consensus estimates call for a narrowing of the trade deficit to USD40.2 million in October from USD41.8 million in September.
Separately, the Commerce Department will release its new home sales report for September and October. Economists expect new home sales to come in at a seasonally adjusted annual rate of 420,000 for September and 425,000 for October.
The Institute for Supply Management is due to release the results of its non-manufacturing survey at 10 am ET. The consensus estimates call for a small improvement in the non-manufacturing index to 55.5 in November from 55.4 in October.
Today during trading hours, the EIA will release its US crude oil inventories report for the weekended November 29. Analysts expect no change in US crude oil inventories and gasoline stocks to add 1.2 million barrels last week.
