Crude oil trades near seven-week high
Oil traded little changed near a seven-week high after US second-quarter gross domestic product and weekly jobless claims beat economists’ estimates in signs that demand may improve.
Crude jumped 2.7pc yesterday, capping the biggest monthly gain since May 2009, after a government report showed that the US economy grew at a 1.7pc annual rate in the second quarter.
Prices also rose as the drop in jobless claims indicated that companies are cutting back on firings.
“There is a level of optimism in the market,” said Jonathan Barratt, managing director of Commodity Broking Services Pty in Sydney.
“Whether or not it has the ability to push through $80, or $82, we really have to see the numbers pick up in terms of business.”
The November contract traded at $80.112 a barrel, up 15 cents, in electronic trading on the New York Mercantile Exchange at 11:25am Sydney time. Yesterday it added $2.11 to $79.97, the highest since August 10.
Futures climbed 11pc in September and 5.7pc in the third quarter. Prices are 4.8pc higher for the week.
US initial jobless claims decreased by 16,000 to 453,000 in the week ended September 25, lower than the 460,000 median forecast of 47 economists surveyed by Bloomberg News, Labour Department figures showed yesterday in Washington. Unemployment has hovered around 10pc.
The revised GDP figure exceeded the 1.6pc median forecast of economists surveyed by Bloomberg News. Growth slowed from 3.7pc in the first quarter.
Business activity in the US also accelerated unexpectedly this month, according to the Institute for Supply Management- Chicago Inc.
The group said its business barometer climbed to 60.4 in September, exceeding the highest estimate of economists surveyed by Bloomberg News.
The government of Ecuador, the smallest oil producer in the Organisation of Petroleum Exporting Countries, called for international help after what it called a “coup attempt” yesterday by members of its security forces.
The opposition is behind the attempt to take down the government, according to a statement on the president’s website.
Ecuador pumped 465,000 barrels a day of crude this month, or 1.6pc of OPEC’s total, a Bloomberg News survey showed yesterday. OPEC’s current president is Wilson Pastor, Ecuador’s minister of non-renewable natural resources.
Brent crude for November settlement was at $82.44 a barrel, up 13 cents, on the ICE Futures Europe exchange in London.