Lower dollar also supports prices
By Claudia Assis and V. Phani Kumar, MarketWatch
SAN FRANCISCO (MarketWatch) — U.S. crude-oil futures bounced back above $95 a barrel on Thursday, recouping a portion of hefty losses from the previous session.
Crude oil for January delivery CL2F +0.24% rose 17 cents to $95.10 a barrel on the New York Mercantile Exchange.
Oil traded as low as $94.67 and as high as $95.99 a barrel earlier in the day.
Prices got support from a weaker dollar, rising stocks, and good news about manufacturing levels in the Philadelphia area.
Oil had plunged $5.19, or 5.2% in Wednesday’s session on Nymex as worries about the euro region’s ability to manage its debt troubles mounted.
The U.S. dollar index DXY -0.28% , which traded flat in Asian trading hours, was recently at 80.333, from 80.538 in late North American trading after Wednesday’s dollar rally.
A gauge of manufacturing activity in the Philadelphia area rose 10.3 in December, from 3.6 in the previous month. Analysts had expected a rise to 5.
Some analysts cautioned there could be further losses in store for crude.
Tim Evans, an analyst at Citi Futures Perspective, said Wednesday’s plunge had caught many money managers “long and wrong,” with aggregate net long positions as of Dec. 6 at their highest number since late July.
He said that a quick liquidation of those long positions in July had pulled the West Texas Intermediate crude contract from $100.62 to $75.71 within just three weeks.
“Markets don’t usually repeat themselves exactly, but we see a similar downside risk now,” Evans said.
Wednesday’s tumble also came as the Organization of the Petroleum Exporting Countries said it will maintain its current production at 30 million barrels per day, including restored output from Libya. Read more on OPEC’s decision.
Among other energy products, the January heating oil HO2F +1.16% rose 3 cents, or 1.1%, to $2.86 a gallon. Gasoline for delivery in the same month RB2F +1.02% climbed 3 cents, or 1.1%, to $2.86 a gallon. January natural-gas futures NG12F +1.08% rose 3 cents to $3.16 per million British thermal units.
Claudia Assis is a San Francisco-based reporter for MarketWatch.
Varahabhotla Phani Kumar is a reporter in MarketWatch's Hong Kong bureau.
