MW:Oil slips, gasoline gains as hurricane nears U.S.
By Polya Lesova and Sarah Turner, MarketWatch
NEW YORK (MarketWatch) — Oil futures dropped on Monday, while gasoline prices rose as the East Coast braced for the arrival of Hurricane Sandy, a storm expected to cause widespread damage.
The headquarters of the CME Group’s New York Mercantile Exchange lies in New York’s mandatory evacuation area. As a result, the New York trading floor will be closed on Monday, but electronic trading will go ahead.
Crude oil for December delivery CLZ2 -0.41% lost 79 cents, or 0.9%, to $85.49 a barrel in electronic trading. Read: U.S. exchanges to close Monday.
On Friday, Nymex oil futures settled 23 cents higher at $86.23 a barrel.
Friday’s mild gain for Nymex oil futures pared losses to about 4% over the week after some mixed economic data.
“The recent pattern has been one of a market sandwiched between a background of poor economic prospects on the one hand, and both relatively supportive global fundamentals and geopolitical complexity on the other hand,” said commodity strategists at Barclays Capital.
“Any consideration of macroeconomics seems still be fairly depressive, even if the edge seems to be coming off some of the darker fears on a hard landing in China,” they said.
The decline in oil prices came as the dollar strengthened. Commodities priced in U.S. dollars, such as crude oil, tend to trade inversely to the greenback, as gains for the dollar make prices more expensive for holders of other currencies.
The ICE dollar index DXY +0.26% , which measures the U.S. dollar against a basket of six other major currencies, rose to 80.202 on Monday from 80.046 in late North American trading Friday.
In other energy trading, November heating oil HOX2 +1.67% rose 2 cents to $3.11 a gallon, and natural gas for delivery in November NGX12 +0.24% was flat at $3.40 per million British thermal units.
November gasoline futures RBX2 +2.76% rose 4 cents, or 1.6%, to $2.74 a gallon. The November contracts are due to expire after the close on Wednesday.
Polya Lesova is MarketWatch's New York deputy bureau chief.
