Crude oil trades near two-year high
Goldman expects price surge in 2012
Oil recovered earlier losses, trading near a two-year high in New York, as a slump in the dollar countered signs of slowing demand in China.
Crude rebounded before the US Energy Department’s weekly inventory report. The industry-funded American Petroleum Institute said yesterday crude supplies fell 7.4 million barrels last week, the biggest drop in two years.
Oil prices will be “substantially higher” by 2012, Goldman Sachs said.
Crude for December delivery rose as much as 33 cents to $87.05 a barrel on the New York Mercantile Exchange and was at $86.99 at 9:02am.
Earlier, the contract fell as much as 55 cents to $86.17. Brent crude for December settlement was up 27 cents at $88.60 a barrel after falling to $87.82 on the ICE Futures Europe exchange in London.
“We’re seeing an increase in fund investments across the commodities space, and the sharp crude inventory drawdown in last night’s APIs is probably supporting interest in oil,” said Robert Montefusco, senior broker with Sucden Financial in London. “The market will need to get through $87.50 to confirm a break higher.”
Futures fell as much as 0.6pc earlier after a report showed that China, the world’s biggest energy user, bought 16.1 million metric tons more crude than it sold last month, down from a record 22.9 million tons in September.
An Energy Department report may show stockpiles in the US, the largest oil consumer, are rising, according to a Bloomberg survey.