IV:NYMEX crude oil higher in Asia on prospects for U.S. economy
Investing.com – Crude oil prices rose slightly in Asia on Monday amid indications that the U.S. economic recovery is deepening.
On the New York Mercantile Exchange, light sweet crude futures for delivery in February traded at USD 99.22 a barrel, up 0.05%.
Nymex oil futures were likely to find support at USD97.76 a barrel, the low from Dec. 19 and resistance at USD100.29 a barrel, the high from Oct. 22.
On the week, U.S. crude futures, also known as West Texas Intermediate or WTI, rose 2.73%.
The Commerce Department said Friday that the U.S. economy expanded by 4.1% in the third quarter, well above initial estimates for 3.6% growth, adding to signs that the economic recovery is gaining traction.
On Wednesday, the Federal Reserve announced plans to begin tapering its USD85 billion-a-month bond buying program by USD10 billion after Fed Chairman Ben Bernanke said the economy was continuing to make progress.
The U.S. central bank reiterated that interest rates are likely to remain low even after the unemployment rate drops below 6.5%, the threshold at which the Fed has previously said it would start to consider rate increases.
Wednesday’s bullish U.S. supply data also supported prices. The Energy Information Administration said in its weekly report that crude oil inventories fell by 2.9 million barrels last week to 372.3 million barrels. That was above expectations for a decline of 2.3 million barrels.
The report also showed that total motor gasoline inventories increased by 1.3 million barrels, compared to expectations for a gain of 1.9 million barrels.
The U.S. is the world’s largest oil consuming nation.
Elsewhere, on the ICE Futures Exchange in London, Brent oil futures for February delivery jumped 1.34% on Friday to settle the week at USD111.77 a barrel. Earlier in the session, Brent prices rose to USD111.89 a barrel, the highest since Dec. 6.
The February Brent contract added 2.63% on the week.
In the week ahead, the U.S. is to release key reports on durable goods orders, new home sales and jobless claims.
Trading volumes are expected to remain light due to the Christmas holiday and as many traders already closed books before the end of the year, reducing liquidity in the market and increasing the volatility.
