MW: Oil turns higher as debt-ceiling debate rages on
By Claudia Assis and Myra P. Saefong, MarketWatch
SAN FRANCISCO (MarketWatch) — Crude-oil futures turned higher Tuesday as the dollar weakened, but prices remained under pressure on wrangling over the U.S. debt ceiling.
Crude for September delivery CL1U +0.92% rose 20 cents, or 0.2%, to $99.40 a barrel on the New York Mercantile Exchange after touching a low of $97.82.
Support came from the lower dollar as well as positive data on consumer confidence.
The Conference Board reported Tuesday that consumer confidence rose to 59.5 in July from a downwardly revised 57.6 in June, helping oil prices pare some of their earlier losses. Oil was trading below $98 ahead of the report.
Also midmorning, the Commerce Department said sales of new single-family homes fell 1% in June to an annual rate of 312,000, falling short of economists’ forecasts for an increase to 325,000.
A failure to reach an agreement to raise the U.S. debt ceiling could cause a selloff in oil prices, said Darin Newsom, a senior analyst at Telvent DTN.
Late Monday, President Barack Obama and House Speaker John Boehner touted rival plans to cut the U.S. deficit and lift the debt ceiling in back-to-back television appearances. Read more about Obama’s and Boehner’s rival plans.
Even if a deal is finally reached, that may boost the dollar, Newsom said. A stronger dollar tends to also put pressure on dollar-denominated oil prices.
The dollar index DXY -0.67% , which tracks the U.S. unit’s performance against a basket of six other currencies, slipped further to 73.601, down from 74.074 late Monday. Read more about currencies action.
Other energy futures turned higher with oil.
August heating oil HO1Q +0.47% gained 1 cent, or 0.4%, to $3.12 a gallon and August gasoline RB1Q +1.01% advanced 2 cents, or 0.7%, to $3.15 a gallon.
August natural gas NG11Q -0.41% kept its losses and traded 5 cents lower at $4.33 per million British thermal units.
Claudia Assis is a San Francisco-based reporter for MarketWatch.
Myra Saefong is a MarketWatch reporter based in San Francisco.
