By Carla Mozee and Barbara Kollmeyer, MarketWatch
MADRID (MarketWatch) — U.S. crude-oil futures remained weak on Thursday, but pulled away from a sharper earlier fall after data showed a jump in durable-goods orders.
Oil for September delivery CLU3 -0.81% was down as much as 80 cents earlier in the session, but was last off 26 cents to $105.14 a gallon in electronic trade. Data showed a 4.2% jump in durable-goods orders for June, the third straight big monthly gain.
Investors continued to fret over Caterpillar Inc. CAT -1.65% , which, a day earlier, said its second-quarter profit fell 43% . It also spoke of weak global economic trends, and investors read the results as a sign that demand for heavy machinery was on the wane, curbing prospects for energy demand worldwide.
The market will be looking ahead to supply data on Thursday.
U.S. government data showed a a fourth weekly decline in crude supplies. Still, total inventories remain well above the five-year average.
The U.S. Energy Information Administration on Wednesday said gasoline supplies declined by 1.4 million barrels, and distillate stockpiles, which include heating oil, fell 1.2 million barrels. Gasoline stockpiles were expected to climb by 800,000 barrels, and distillate inventories were projected to increase 1.9 million barrels, according to a Platts survey of analysts.
Oil on Wednesday fell by $1.84, or 1.7%, on the New York Mercantile Exchange after an HSBC report showed preliminary manufacturing activity in China — among the world’s largest oil consumers — fell to an 11-month low in July.
“It is clear to us that the skew is still towards downside risks to Chinese growth, despite [Chinese] Premier Li’s recent assurances about keeping [economic] growth from falling to 7%,” Brown Brothers Harriman currency analysts said to clients Wednesday.
China’s cabinet late Wednesday said it plans tax cuts for small businesses, aid for some exporters, and increased state investment in railways. Oil prices remained lower after the announcement. See more on Asian stock-market action Thursday.
August gasoline futures RBQ3 -2.04% on Thursday slipped 5 cents, or 1.7%, to $3.00 a gallon. On Wednesday, they fell less than a half cent. August heating oil on Thursday dropped 5 cents, or 1%, to $3.02 a gallon, extending Wednesday’s decline of 2 cents a gallon.
August natural gas NGQ13 +0.22% was flat at $3.72 per million British thermal units. Later Thursday, the EIA will release its weekly update on natural-gas supplies in storage. Analysts are looking for an increase of 47 billion to 51 billion cubic feet.
Carla Mozee is a reporter for MarketWatch, based in Los Angeles. Follow her on Twitter @MWMozee.
Barbara Kollmeyer is an editor for MarketWatch in Madrid. Follow her on Twitter @MWBarbaraKollmeyer.
