Oil prices fall after US data

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Oil prices were lower on Thursday as traders banked profits after two straight days of gains as disappointing US economic data dented investor confidence.

New York's main contract, light sweet crude for delivery in July, was down $1.32 at $100 per barrel.

Brent North Sea crude for July retreated 45 cents to $114.48.

"It's just a retreat after a strong two-day rally, and some profit taking," said VTB Capital commodities analyst Andrey Kryuchenkov.

The markets were hoping for an upward revision from the initial reading of 1.8 percent in first quarter US growth but the figures were left unchanged.

At the same time, there was an increase in US new jobless when forecasts had been for a drop and this dented confidence again after other recent data which showed a distinct softening in the economy.

The oil market began this week with sharp losses, tumbling on Monday as the dollar strengthened on the back of more European debt problems.

Prices were also pushed lower by indications of slowing economic growth in Asia but then picked up sharply on Tuesday US banks Goldman Sachs and Morgan Stanley both raised their 2012 forecasts for Brent to around $130 a barrel.

Data Wednesday showing a surprise increase in American crude stockpiles took the gloss of that performance.

US crude reserves rose by 600,000 barrels in the week to May 20, confounding analyst expectations of a fall and indicating weakening demand, while US gasoline (petrol) inventories jumped a huge 3.8 million barrels, in contrast to predictions of a drop.

Gasoline figures are being closely watched ahead of the peak-demand driving season in the United States starting next week, when many Americans begin hitting the road for their summer holidays.

© 2011 AFP

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