Friday, March 12, 2010

Crude Oil Poised for Weekly Gain on Economic Recovery Optimism

March 12 (Bloomberg) -- Crude oil traded above $82 a barrel in New York, poised for a weekly gain, on optimism fuel demand will increase amid improved prospects for an economic recovery in the U.S., the world’s biggest energy consumer.

Oil rose 0.2 percent today after the number of Americans filing first-time claims for jobless benefits fell for a second week, Labor Department figures showed yesterday. The Organization of Petroleum Exporting Countries is set to increase shipments at the end of the month on strong demand from China.

“There’s a consensus that the economy is growing, but also a great deal of uncertainty about the strength of the recovery,” said Peter Beutel, president of trading adviser Cameron Hanover Inc. in New Canaan, Connecticut.

Crude oil for April delivery traded at $82.31 a barrel, up 20 cents, in electronic trading on the New York Mercantile Exchange at 10:21 a.m. Sydney time. Yesterday, the contract rose 2 cents to $82.11. Futures are poised for a 1 percent gain for the week.

Oil fluctuated yesterday as the dollar changed direction against the euro on conflicting economic news. Reports from the U.S. government showed that the country’s trade deficit narrowed, indicating a slowing recovery, while jobless claims decreased.

The dollar traded at $1.3682 against the euro at 10:24 a.m. Sydney time, from $1.3681 yesterday. The strength of the dollar has guided commodity prices over the past three years as investors look at raw materials as a store for value.

OPEC Shipments

OPEC will increase shipments on strong demand in China during the four weeks ending March 27, according to consultant Oil Movements. The group will raise exports by sea to 23.2 million barrels a day, up 0.9 percent from 23 million in the month ended March 20, the Halifax, England-based tanker-tracker said yesterday.

OPEC ministers are scheduled to meet and discuss production targets in Vienna on March 17. Shokri Ghanem, chairman of Libya’s National Oil Corp., said “no new decision is expected” at the meeting, according to a March 9 statement.

Fewer Americans filed first-time claims for jobless benefits last week, a report from the Labor Department showed. Initial applications dropped by 6,000 to 462,000 in the week ended March 6. The number of people receiving unemployment insurance increased, while those getting extended benefits fell.

Brent crude oil for April delivery dropped 20 cents to end the session at $80.28 a barrel on the London-based ICE Futures Europe exchange yesterday.