By V. Phani Kumar, MarketWatch
MADRID (MarketWatch) — Crude-oil futures edged up Thursday, but gains were still muted versus the prior day, as worries that the Federal Reserve won’t launch fresh monetary stimulus belied market expectations of a boost to commodity prices.
Benchmark U.S. light, sweet crude-oil futures for April delivery CLJ2 +0.36% rose 16 cents to $107.23 a barrel in electronic trading. The front-month contract had added 52 cents in a volatile New York Mercantile Exchange session.
“If investors believe that the Fed is unwilling to provide further liquidity, then this could be a signal that other central banks will also hold back from providing additional stimulus over the coming months,” David Morrison, senior market strategist at GFT Markets, wrote in a note to clients.
“If so, then oil could retreat further on the expectation of reduced demand, although continuing geopolitical tensions should still offer some support,” he said.
Fed Chairman Ben Bernanke said in testimony to Washington lawmakers Wednesday that the U.S. central bank is closely watching macroeconomic data after recent improvement in the unemployment rate. His comments damped expectations for a third round of asset purchases. Read more about Ben Bernanke’s testimony.
Among other energy products, April futures for gasoline RBJ2 +0.71% lately traded up 1 cent at $3.27 a gallon, while the April contract for heating oil HOJ2 -.00% was flat at $3.20 a gallon.
