BLBG: Oil mostly lower as traders weigh demand outlook
Traders eye data for demand prospects; natural-gas futures sink
By Myra P. Saefong and Sara Sjolin, MarketWatch
SAN FRANCISCO (MarketWatch) — Crude-oil futures traded mostly lower Monday, pressured by strength in the dollar as traders weighed the outlook for energy demand against a backdrop of mixed U.S. economic data.
Crude for March delivery CLH3 -0.02% shed 2 cents to $95.85 a barrel on the New York Mercantile Exchange.
It traded in a range between $95.47 and $96.81.
“The euro has reversed from positive territory and is charging lower, with the pending home sales data unwinding all the earlier optimism,” said Matt Smith, a commodity analyst at Schneider Electric in Louisville, Ky.
Weakness in the euro helped strengthen the dollar, weighing on dollar-denominated commodities such as oil. The ICE dollar index DXY +0.06% stood at 79.817, up from late Friday’s 79.762. See: Dollar edges higher, as yen dives deeper.
In economic news, pending homes sales fell 4.3% in December, with the National Association of Realtors’ pending-home-sales index declining to 101.7 from 106.3 in November. See: Pending home sales fall in December.
Oil prices had added to gains after news earlier Monday that orders for long-lasting, big-ticket items made in the U.S. soared 4.6% in December. Economists polled by MarketWatch had expected orders to climb 2.5%. See: Orders for long-lasting goods jump 4.6%.
“After the bullish durable-goods number earlier, risk on has swiftly switched to risk off, with even the products being dragged lower despite the bullish news of the Hess refinery closure,” Smith said.
Hess Corp. HES +5.14% said it planned to sell its U.S. terminal network and close its Port Reading, N.J. refinery by the end of February, completing its exit from the refining business.
Oil products were mixed. Gasoline for February delivery RBG3 +1.84% tacked on nearly 5 cents, or 1.6%, to $2.92 a gallon, while heating oil for the same month HOG3 +1.30% was down nearly 1 cent, or 0.2%, at $3.05 a gallon.
February natural gas tumbled 12 cents, or 3.6% to $3.32 per million British thermal units. If prices settle around this level, that will be the lowest settlement in more than two weeks.
“Warmer weather outlooks are spurring on a rout for natural gas today, while total demand dropped off last week and domestic production edged higher,” said Smith. The February natural-gas contract expires at the close of Nymex trading on Tuesday.
Myra Saefong is a MarketWatch reporter based in San Francisco. Follow her on Twitter @MktwSaefong.
Sara Sjolin is a MarketWatch reporter based in London. Follow her on Twitter @sarasjolin.
