World oil prices edge ahead on US data

31st August 2011, Comments 0 comments

Oil prices rose slightly on Wednesday as traders tracked buoyant global equity markets, upbeat economic data and sliding gasoline reserves in top crude-consuming nation the United States.

Brent North Sea crude for delivery in October added 57 cents to $114.59 in late afternoon deals.

New York's main contract, West Texas Intermediate (WTI) for October, gained five cents to $88.95.

Wall Street rallied more than one percent after payrolls firm ADP said the US private sector created 91,000 jobs in August, while another report pointed to growth in manufacturing, stoking hopes the economy wills get through its current slow patch.

European stock markets bounced higher, with Frankfurt, London and Paris soaring by between 2.0 and 3.0 percent.

Separately, a gauge of industrial activity in the US Midwest did better than expected.

The Institute of Supply Management-Chicago's purchasing managers' index fell to 56.5 in August from 58.8 in July, but stayed above analysts' forecasts. Any number greater than 50 indicates expansion.

Equities also got a boost from a decision by German Chancellor Angela Merkel and her cabinet to approve changes to the latest European rescue fund and send it to parliament for ratification.

The amendments to the European Financial Stability Facility are seen as a key measure in staving off disaster in the eurozone's debt crisis, which has roiled global financial markets over the past months.

The US Department of Energy reported that American gasoline or petrol stockpiles dived by 2.8 million barrels in the week ending August 26.

That was far greater than expectations for a one-million-barrel decline, according to analysts polled by Dow Jones Newswires, and signalled strong demand.

At the same time however, the DoE added that oil inventories soared 5.3 million barrels last week. That eclipsed market expectations for a gain of just 200,000 barrels.


© 2011 AFP

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