Oh Kippers, you are NOT going to believe thisApril 26, 2015 4:51
Brent crude steady above $100 as fed holds off stimulus
Oil rallied more than 2 pct on Wed as N.Sea supply tightens; Fed holds off stimulus until economy worsens; Coming Up: U.S. weekly jobless claims
July 12, 2012 11:01 by Reuters
Brent crude stayed above $100 per barrel on Thursday, after a more than 2 percent rally in the prior session, as uncertainty over whether the U.S. Federal Reserve would launch more stimulus measures curbed investor appetites for riskier assets.
Minutes from the central bank’s June meeting suggested the U.S. economy may need to worsen before the majority of policymakers will consider a third round of bond buying that could weaken the greenback and draw investors to buy dollar-denominated commodities.
Brent crude had edged down 17 cents to $100.06 by 0425 GMT, with worries about tight North Sea supplies keeping losses in check, while U.S. crude was at $85.62, down 19 cents.
“Traders are starting to look forward for stimulus measures, particularly from China. We can see confidence improving a bit,” Ric Spooner, chief market analyst at CMC Markets in Sydney, said. Further U.S. stimulus measures are “probably a few months away” if the employment situation does not improve, he added.
China is due to release GDP data on Friday that could show the weakest expansion in three years. If confirmed, the figures could help support oil as investors expect the government to introduce measures to boost the economy.
The grim outlook for the global economy, already roiled by the festering debt crisis in the euro zone, has muddied the demand outlook for most commodities. Oil has been hit hard, with prices suffering their largest three-month drop since the 2008 financial crisis in the second quarter.
Oil prices have rebounded from their June lows of below $90 for Brent and around $77 for U.S. crude as investors pumped in money after a debt deal in Europe sparked a buying frenzy across commodities.
NORTH SEA, IRAN SUPPLY CONCERNS
Oil rallied on Wednesday on expectations of lower exports from the North Sea in the wake of the Norwegian labour strike, while the market stayed alert to sabre-rattling talks between Iran and the West that could disrupt oil shipments in the Strait of Hormuz.
The combined daily export volume of the four benchmark North Sea crude oil streams was expected to fall to a record low in August based on Reuters calculations.
Prices also found support from shrinking U.S. crude oil stockpiles and worries about Iran’s exports.
“We’ve seen U.S. crude inventory numbers falling, heading for the right direction, and there is concern about the extent to which Iran supply is taken off the market and tighter spare production capacity,” Spooner said.
U.S. government data showed crude inventories fell 4.7 million barrels last week, almost four times the forecast in a Reuters poll.
“As the summer driving season and peak seasonal U.S. oil demand is in full effect, we expect refinery runs to remain at high levels, helping to draw upon crude stocks, which have been on the rise due to higher North American production,” J.P. Morgan analysts said in a note.
The world oil demand growth picture remained gloomy as OPEC expects another slowdown in 2013 on Europe’s debt worries, a faltering economic recovery in the United States and slower growth in emerging markets. OPEC’s report was released a day after the EIA cut its world oil demand growth forecast for 2012 and 2013.
(Editing by Himani Sarkar and Chris Lewis)