MW: Oil seesaws as Bernanke offers hope, no stimulus
By Claudia Assis, MarketWatch
SAN FRANCISCO (MarketWatch) — Crude-oil futures fluctuated Friday as U.S. Federal Reserve Chairman Ben Bernanke offered a more optimistic view of the U.S. economy and deferred all talks of further steps to a policy meeting in late September.
Oil’s first reaction was to extend its early decline as Bernanke dashed the hopes for at least a hint of economic stimulus, which would also work to spur more oil demand.
But Bernanke “did offer an optimistic assessment of the U.S. economy, and that gave us a little bit of a bounce,” said Jim Ritterbusch, president of Ritterbusch and Associates in Illinois.
The lack of additional stimulus measures, however, would make it “very difficult” to keep that bounce going for long, he said.
Crude for October delivery CL1V -0.67% recently declined 6 cents, or 0.1%, to $85.26 a barrel on the New York Mercantile Exchange. It had earlier traded as low as $82.95 a barrel, and as high as $85.64 a barrel.
Bernanke spoke at a yearly gathering of central bankers in Jackson Hole, Wyo. At last year’s meeting, he had signaled the second round of the Fed’s asset-buying program known as quantitative easing. Read more about Bernanke’s speech.
Oil prices also reacted to a rebound for U.S. equities, which had opened lower.
Energy products were mixed Friday, with gasoline keeping its losses.
The commodity had gotten a lift Thursday from fears of Hurricane Irene disrupting East Coast refineries.
The hurricane will miss the Gulf Coast area, the heart of the refining and oil production industry, but threatens several refineries in the East Coast. Irene, a Category 2 hurricane, could intensify, the National Hurricane Center said. Read more about Hurricane Irene.
Gasoline for September delivery RB1U -1.14% lost 2 cents, or 0.6%, to $2.95 a gallon. September heating oil HO1U +0.30% added 2 cents, or 0.5%, to $3 a gallon.
Irene is expected to make landfall Saturday and governors of several states in the East Coast, including New Jersey and New York, have declared a state of emergency.
Refineries on Irene’s path include those owned by ConocoPhillips COP +1.05% , PBF Holdings and Sunoco Inc. SUN +0.28%
