Oil rises to three-month high
Oil rose to a three-month high in New York as the dollar weakened and analysts forecast that crude inventories declined last week in the US.
Crude-oil supplies probably fell by 1.5 million barrels last week, a Bloomberg News survey showed before an Energy Department report tomorrow.
Futures earlier breached $82 a barrel for the first time since May as European equities pared losses after an index from the Institute for Supply Management yesterday showed that US manufacturing slowed less than analysts forecast in June.
“The ISM number in effect wasn’t as bad as expected, which was positive for sentiment in oil and equity markets,” said Harry Tchilinguirian, London-based head of commodity-markets strategy at BNP Paribas SA. “But the recent macro data flow indicates that activity has slowed down. We will probably give back some of the gains.”
Crude oil for September delivery climbed as much as 76 cents, or 0.9pc, to $82.10 a barrel, in electronic trading on the New York Mercantile Exchange, the highest level since May 5. It traded for $81.70 at 12:48 pm London time. Brent crude for September settlement gained 74 cents to $81.56 a barrel on the London-based ICE Futures Europe exchange.
The euro advanced 0.6pc versus the dollar to $1.3237, making crude more attractive to investors for protecting against inflation.
The US Energy Department is scheduled to release its weekly report at 10:30 am tomorrow in Washington. The industry-funded American Petroleum Institute’s numbers will be made available at 4:30 pm local time today.
Crude stockpiles dropped 1.5 million barrels in the seven days ended July 30 from 360.8 million a week earlier, according to the median of 11 analyst estimates before an Energy Department report this week. Eight respondents forecast a decrease and three said there was a gain.
Gasoline inventories declined 1 million barrels from 222.2 million the prior week, according to the survey. It would be the first drop since June 18. Eight analysts anticipated a fall, and three forecast an increase.
Stockpiles of distillate fuel, a category that includes heating oil and diesel, rose 1 million barrels from 167.5 million, the survey showed. Ten respondents forecast a gain, and one said there was a decline.
The Institute for Supply Management’s manufacturing gauge dropped to 55.5 last month from 56.2 in June. A reading greater than 50 points to expansion, and the median forecast of economists surveyed by Bloomberg News was 54.5.