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LONDON, Aug 12 (Reuters) — Oil slipped towards 69 a barrel on Wednesday, falling for the fifth straight session, as growing concerns about the strength of demand pressured prices ahead of the release of weekly U.S. inventory data.World oil demand growth will be lower in 2010 than previously forecast, the International Energy Agency (IEA) said in its monthly market report on Wednesday, with evidence a global recovery is underway still limited.The Paris-based agency, adviser to 28 industrialized nations, said global oil demand was now seen recovering by just 1.3 million barrels per day (bpd) in 2010, having fallen by 2.3 million bpd this year as the economic crisis curbed consumption. World oil demand hit a peak of 86.5 million bpd in 2007.”Evidence of a bottoming out of the recession is still a bit patchy. The latest data on industrial production for some of the larger countries remains negative,” David Martin, analyst at the IEA, told Reuters.”There is not clear evidence yet we have seen the worst.”U.S. light crude for September delivery fell 25 cents to 69.20 a barrel, having lost 1.15 on Tuesday following Wall Street losses and after the U.S. Energy Information Administration (EIA) also revised down its oil demand forecast.InventoriesFalling demand for oil has seen inventories of crude and oil products stack up around the world.Combined with the impact of an insipid U.S. summer driving season, the drawdown in stocks typical of this time of year has not happened. The IEA said stocks in developed countries stood at almost 68 days of forward cover at the end of June.On Tuesday, weekly stocks data from the American Petroleum Institute (API) showed an unexpected fall of 1.4 million barrels in crude stocks, together with a larger-than-expected 2.3 million barrels fall in gasoline stocks.But the data, released after Tuesday’s prices settlement, failed to lift the oil market.”Today traders will be watching the Fed meeting and the EIA data. The stronger dollar and waning sentiment for equities have been short-term bearish for crude, which has been trading as an asset class recently,” said Jonathan Kornafel, Asia director of U.S.-based Hudson Capital Energy.The EIA, the statistical arm of the U.S. Department of Energy, will release its own weekly snapshot of U.S. fuel inventories at 10:30 a.m. ET.Data from the EIA and API can diverge widely.An expanded Reuters poll of analysts on Tuesday showed expectations of a 700,000-barrel rise in crude stocks, a 1.3-million-barrel increase in gasoline stocks and a 200,000-barrel drop in distillates stocks.Traders will also keep a close eye on the two-day U.S. Federal Reserve meeting that ends later on Wednesday with a statement expected at about 2:15 p.m. ET.

Source:CNN

NEW YORK (Reuters) — The dollar hit a nine-month low against the euro and slipped against the yen Wednesday as investors hoped a slower pace of U.S. private job losses in July hinted at a gradual improvement in the economy.Safe-haven demand earlier lifted the dollar against the euro after reports showed private employers cut more jobs than expected and the dominant U.S. service sector shrank again.But July’s job losses were down from June’s, sparking hope Friday’s more comprehensive government employment report would show labor market improvement.”The jobs headline was a bit disappointing, but the market has been judging mixed data from a glass-half-full viewpoint,” said Michael Woolfolk, currency strategist at The Bank of New York-Mellon. “They’re trying to focus on the positives.”Goldman Sachs (GS, Fortune 500) provided another excuse to do that by revising its real U.S. growth forecast for the second half of the year from 1% to 3%.Late Wednesday, the euro was little changed at 1.4414 but earlier rose to 1.4446, its highest level sine December. The dollar fell 0.3% to ¥94.95.A clutch of better-than-expected UK data lifted sterling to a near 10-month peak at 1.7042. It was last up 0.4% to 1.7000.Recent data from the United States and elsewhere have been mixed, but enough of the data has been encouraging enough to foster hopes that the worst of the recession is over.Investors were pleasantly surprised last month by data showing the U.S. economy shrank by a smaller-than-expected 1% in the second quarter, leaving many to bet on positive third-quarter growth.Wall Street has rallied as a result, though its dip on Wednesday snapped a four-day winning streak. The dollar has also found it difficult to rally as emboldened investors instead seek higher-yielding currencies and assets.”Markets were priced for total Armageddon and guess what? It didn’t happen,” said T.J. Marta, founder of Marta on the Markets in Scotch Plains, N.J. “Now many investors are scrambling, knowing there’s business out there to be done.”The trend to sell the dollar on the view that the worst of the world recession is over has become quite deeply rooted, analysts said.”The default setting is still that risk is on unless we get really clear, definitive data to the contrary, and that doesn’t seem likely at this stage,” said Brian Dolan, chief currency strategist at Forex.com in Bedminster, New Jersey.Next up for currency investors are Thursday’s policy decisions from the Bank of England and European Central Bank.A Reuters poll last week showed economists are split over whether the BoE will inject more money into the economy by extending its asset purchases, although recent brighter UK economic data are seen reducing such chances.But the risk exists, said Daragh Maher, deputy head of FX strategy at Calyon in London. “It would be a brave investor that held on to an aggressively long [pound] position into the BoE meeting.”

Source:CNN

LONDON (Reuters) — Oil fell towards 70 a barrel on Wednesday after U.S. government inventory data showed a build in crude stocks and weak economic data raised doubts about oil demand recovery in the world’s largest energy consumer.U.S. light, sweet crude fell 81 cents to 70.61 a barrel, giving away some of the gains that helped oil rise 13% since late last week.U.S. crude inventories rose more than expected last week as refinery runs eased, while distillate stocks showed a surprise draw, according to weekly data from the U.S. Energy Information Administration (EIA) released on Wednesday.Crude stockpiles in the world’s top consumer rose by 1.7 million barrels in the week to July 31, against forecasts for an 800,000-barrel build as refinery utilization fell by 0.1 percentage point to 84.5%.”The big build on crude caught some people by surprise and shows overall weakness in the economy and the unwinding of economic optimism. Nothing in the numbers was very bullish,” said Phil Flynn, analyst at PFGBest Research in Chicago.The EIA data followed inventory numbers on Tuesday from the American Petroleum Institute, which showed crude stocks fell 1.5 million barrels last week but gasoline stocks rose by a further 2.1 million barrels.Oil was already lower before the release of inventory figures as doubts over economic recovery and demand for fuel resurfaced after weak U.S. services sector data depressed stock markets both sides of the Atlantic.Expectations that a turnaround in the global economy could lift sagging oil demand has helped send crude up from lows below 33 a barrel in December, with energy traders keeping an eye on equities markets for signs of an economic rebound.Investors were awaiting news from a meeting between trade representatives and Britain’s financial powers, the UK Financial Services Authority (FSA) and the UK Treasury, which comes before a third Commodity Futures Trading Commission (CFTC) hearing in Washington over how to rein in speculation.The UK meeting will discuss market transparency and efficiency, according to the FSA invitation to oil market participants, a copy of which has been seen by Reuters.Energy traders also were watching an area of thunderstorms in the Atlantic Ocean several hundred miles southwest of the Cape Verde Islands associated with a tropical wave. The U.S. National Hurricane Center said it had less than a 30% chance of becoming a tropical storm.

Source:CNN

LONDON (Reuters) — The dollar fell broadly on Monday as stronger equities and oil prices continued to buoy sentiment, with perceived higher risk currencies such as sterling and the Australian dollar rising sharply.These currencies hit multi-month highs as European shares rose 1.2% and oil prices were above 70 per barrel, keeping investor sentiment towards riskier assets buoyant.Optimism has been building in the market following a better-than-expected U.S. gross domestic product reading on Friday, which lifted hopes that the global economy is over the worst of the downturn.Below-forecast results from UK bank Barclays helped bring the euro off highs, however, with traders noting that its earlier failure to sustain a move above 1.43 also weighed on the single currency.Barclays PLC announced results that fell short of expectations with an 8% rise in half-year profit as bad debts at Britain’s second biggest bank almost doubled to offset buoyant earnings from its enlarged investment bank.The euro was helped back into positive territory, however, after some good news on the euro zone economy, with revised figures showing the region’s purchasing managers’ index for manufacturing rose to 46.3 in July — an upward revision from the provisional 46 — from 42.6 in June.This was the second biggest monthly rise in the series’ 12-year history.0:00
/2:50Economy: Here comes the sunMarket participants are awaiting the key U.S. ISM survey on manufacturing activity later in the day, while later this week central bank policy decisions are due in Australia, the UK and the euro zone.”The Barclays results may have contained markets a little and people may be a little hesitant before today’s U.S. ISM data,” said Nordea currency strategist in Copenhagen Niels Christensen.”But I still see the market positive on risk – it would need very negative numbers out of the U.S. to dent risk appetite,” he said.The euro rose 0.2% against the dollar to 1.4271 after rising as high as 1.4310 on trading platform EBS, its highest since early June.The dollar index, a gauge of the U.S. currency’s performance against six other major currencies, fell 0.2% to 78.162.Among currencies seen as higher risk, sterling rose 0.7% to a nine-month high around 1.6851, lifted by better-than-expected UK manufacturing PMI data.The New Zealand dollar hit a 10-month high of 0.6665, while the Australian dollar also hit its highest since late September of 0.8400.Traders said the Aussie was being supported by expectations that the Reserve Bank of Australia may drop a key reference on monetary easing at its policy meeting on Tuesday while keeping the cash rate unchanged at 3%.”Ahead of many events this week such as economic data in the U.S. and earnings from major companies in Europe and Japan, investors largely stayed on the sidelines,” said Yuji Saito, head of the forex sales department at Societe Generale in Tokyo.”As long as the market will be able to cope with those economic events, it will likely keep its risk-taking stance,” he said.Firm risk appetite also weighed on the yen, with the euro up 0.4% at 135.42 yen, while the dollar gained 0.2% to 94.86 yen.

Source:CNN

NEW YORK: The national average price for gas fell below 2.50 a gallon for the first time since May, motorist group AAA said Thursday, providing a much needed break for cash-strapped drivers.The national average for regular gasoline slid 1.2 cents overnight to 2.492 a gallon, according to AAA’s daily survey of up to 100,000 filling stations. Prices have not been this low since May 30, when the national average stood at 2.484 a gallon. Gas prices have fallen for 25 days in a row, dropping more than 20 cents in that time, after the national average rose to 2.693 a gallon — its highest level of the year — on June 21. Despite the decline in the national average, gas prices remain above 3 a gallon in Alaska and Hawaii. Gas was cheapest in Missouri, where a gallon averages 2.245.Gas prices spiked in June as the price of crude oil, which is the main ingredient in gasoline, rose above 72 a barrel and producers switched to more expensive summer fuels. However, gas prices typically fall after the July 4th holiday.While gas prices remained well below the highs of last summer, the recent run-up took a toll on households already struggling with unemployment and housing woes. Last year, gas prices soared to an all-time high of 4.114 a gallon in July as oil prices skyrocketed to a record near 150 a barrel. Prices abruptly dropped in the second half of last year, with the national average gas price falling to a low of 1.656 in December.

Source:CNN

LONDON (Reuters) — Oil reversed early gains and dropped below 60 a barrel on Thursday as a downturn in the stock market added to pressure from high oil inventories and persistent concerns about the timing of any economic recovery.Light crude for August delivery fell 45 cents to 59.69 a barrel and was on course for the seventh straight day of declines. Earlier on Thursday, crude prices had rebounded as high as 61.62 after a 4% fall on Wednesday that meant oil was more than 15% lower so far in July.Analysts said oil markets on were undermined when, after a bounce in European shares, stocks turned lower shortly after the opening. The slide was given impetus by the breach of psychological support around the 60 a barrel mark.”This morning’s bounce served notice that the equity and currency markets remain as formidable price influences to the oil,” said Jim Ritterbusch, President of Ritterbusch and Associates in Galena, Illinois.”The crude, stock market and U.S. dollar are maintaining some correlation to reflect an expansion and contraction in risk appetite as additional economic input is received.”On Wednesday, bearish oil data highlighted how weak demand is in the world’s largest energy consumer.Diesel and heating oil stocks have swelled to their highest level in almost 25 years after jumping by 3.7 million barrels last week, data from the Energy Information Administration (EIA) showed.The drop in oil prices since the end of June was the longest and steepest decline so far in 2009. Prices had been rising since February, more than doubling from lows hit near 33, as traders started to price in an eventual recovery.0:00
/3:15Daimler’s rocky roadBut many analysts cautioned prices had risen ahead of the real economy, with unemployment still climbing and global oil inventories mounting up.”The buy-side euphoria associated with the ‘recovery trade’ now clearly seems to have waned,” MF Global analyst Edward Meir said.The fragile state of the global economy dominated the annual G8 summit, with the United States, Japan, Germany, France, Britain, Italy, Canada and Russia acknowledging there were still significant risks to financial stability.OPEC’s 2009 World Oil Outlook has weighed further on sentiment as it said world demand for oil may take years to recover from the slump in 2009 because of economic weakness and demand destruction.The Organization of the Petroleum Exporting Countries said consumption of its crude will not return to 31 million barrels per day (bpd), the level it averaged in 2008, until 2013.

Source:CNN

LONDON (Reuters) — A bigger-than-expected rise in U.S. gasoline stocks and a fresh focus on global financial weakness pushed oil markets down Thursday to around 68 a barrel.For the next clue on the economic health of the world’s top energy consumer, traders were looking to U.S. non-farm payroll data for release on Thursday, expected to show unemployment at a 26-year high of 9.6%.U.S. crude fell 1.08 to 68.23 a barrel. The contract settled 58 cents lower at 69.31 on Wednesday.”There’s a sense we’re breaking to the down-side because of weak economic data … unemployment, house prices, lower stock markets,” said Christopher Bellew of Bache Commodities.In addition he cited Wednesday’s U.S. government inventory data that showed gasoline stockpiles in the United States rose by 2.3 million barrels last week.Distillates, including diesel, also rose by 2.9 million barrels, although crude stocks dropped by 3.7 million barrels.Traders viewed the increase in motor fuel ahead of the U.S. July 4 Independence Day holiday — which traditionally marks the peak of the U.S. summer driving season — as a symptom of continued demand weakness.Some analysts are still bullish, however, and say the Organization of the Petroleum Exporting Countries has been very successful in stabilizing the market.Oil has rallied from a low of 32.40 in December last year to highs above 70 a barrel in June, although it is only around half last July’s record of more than 147.Over the second quarter of this year it gained around 40% — the strongest quarterly gain since 1990.OPEC support”Everybody has been surprised at the effectiveness of the OPEC cuts,” said Angus McPhail of British-based investment firm Alliance Trust.”We’re in a normalized range somewhere between 60 and 80 in the current environment, excluding the Iranians kicking off… Nigeria etc… I think that’s what we’re looking at and it’s what OPEC’s looking at too.”Political unrest in oil producer Iran has had little impact on prices because the oil market is well-supplied and there is no expectation of Iran cutting off supplies.Militant unrest in OPEC member Nigeria has had a bigger impact. It has forced the shut-in of an estimated 600,000 to 700,000 barrels per day (bpd).The involuntary output reduction has improved OPEC’s compliance with production curbs, although discipline has retreated from a peak of around 80% earlier this year.Reuters’ latest OPEC survey assessed compliance at around 72% of promised cutbacks totaling 4.2 million bpd since September.As output creeps higher, one of OPEC’s smallest crude exporters Qatar told at least two Asian term buyers it will supply its Marine crude at full contracted volumes for August, compared with 14% supply curbs for July, sources at the firms said on Thursday.While the West has taken the brunt of economic downturn, analysts have been looking to Asia to keep generating fuel demand.But the governments of China and India this week both unexpectedly raised gasoline and diesel prices by as much as 10%, potentially capping demand growth.

Source:CNN

NEW YORK (Reuters) — The U.S. dollar fell broadly Tuesday as stabilizing equity markets in Europe and the United States eroded safe-haven flows into the greenback.The euro jumped above 1.40 as financial markets awaited the outcome of a U.S. Federal Reserve policy meeting that concludes Wednesday and a record 104 billion in U.S. debt issuance this week.European shares were steady, while Wall Street was set to rise at the open, the day after the worst one-day loss in two months, encouraging investors to be a little less averse to risk.”We have risk appetite back this morning, and the dollar is suffering on the back of that a little bit,” said Jacob Oubina, currency strategist at Forex.com in Bedminster, New Jersey.0:00
/3:32America’s growing debt dilemmaIn early New York trading, the euro rose 0.9% against the dollar to 1.3987, after hitting a session peak of 1.4008, according to Reuters data.The ICE Futures U.S. dollar index, which tracks the value of the greenback against a basket of major currencies, fell 0.7% to 80.316.The focus is on the U.S. Federal Reserve’s policy-setting Federal Open Market Committee, which begins its two-day meeting Tuesday, with a decision scheduled for Wednesday.The market will be watching to see whether the central bank gives a slightly brighter economic view, while also watching whether it will address the recent rise in Treasury debt yields.”Generally we are in a waiting phase ahead of the FOMC meeting,” said Michael Klawitter, senior currency strategist at Dresdner Kleinwort in Frankfurt. “No one is willing to test the recent ranges in euro/dollar, though the pick-up in U.S. futures has lent some support to the euro.”Against the yen, the dollar was little changed at ¥95.84 recovering from an earlier three-week low just below ¥95, according to electronic trading platform EBS.

Source:CNN

LONDON (Reuters) — Oil dropped below 69 a barrel on Monday pressured by a stronger dollar and weaker European equities, but attacks on the oil industry in top African exporter Nigeria limited losses.Nigeria’s main militant group said on Sunday it had attacked three oil installations belonging to Royal Dutch Shell in the Niger Delta, widening a month-old offensive against Africa’s biggest energy industry.”We’ve got weakening stock markets and the dollar is starting to strengthen,” said Rob Montefusco, a trader at Sucden Financial. “With all the violence in Nigeria, that’s going to keep it relatively firm.”0:00
/4:36T.Boone Pickens: 300 oilU.S. crude for July, which expires later on Monday, fell 1.19 to 68.36 by 6:55 a.m. ET. The contract fell more than 2% on Friday. European stocks lost ground and the dollar rose against a basket of other major currencies. A stronger dollar can limit the appeal of oil and commodities to investors.Chart patterns are also pointing lower for crude. Both Brent and U.S. crude closed below the 70 mark on Friday, a bearish technical development. Even so, crude has more than doubled from a low of 32.40 in December.Rebels in Nigeria have been carrying out attacks on the oil industry for years in what they claim is a struggle for a fairer share of the region’s energy wealth.Also supporting the market was data showing China’s implied oil demand rose 6% in May over a year ago, its fastest growth since August 2008. China is the world’s second largest user of oil.In the Middle East, Iranian opposition leader Mirhossein Mousavi urged supporters to continue protests over the re-election of President Mahmoud Ahmadinejad, in a direct challenge to the Islamic Republic’s leadership.Some analysts say the political turmoil in Iran, a major oil exporter, so far is of limited significance for the markets due to high levels of unused production capacity and inventories. Others see it as supportive.”The deterioration in the Iranian situation should prevent a sharper sell-off,” said Edward Meir, analyst at MF Global.Crude oil speculators on the New York Mercantile Exchange slashed their net long positions nearly in half in the week to June 16, data showed on Friday. Long positions are bets that prices will rise.

Source:CNN

NEW YORK (Reuters) — The dollar fell against the euro and higher-yielding currencies Thursday as generally positive U.S. economic data bolstered hopes the world’s largest economy was on a stable path to recovery.Action in the euro was particularly heavy, with the single European currency jumping against the Swiss franc amid speculation the Bank for International Settlements was buying euros on behalf of the Swiss National Bank to defend the 1.50-franc level.But except for that brief movement in the euro/Swiss franc pair, traders were primarily focused on the ongoing debate about the global economic recovery.On Thursday, a report showing stronger-than-expected business conditions in the U.S. Mid-Atlantic region and a weekly Labor Department report showing a decline in continued claims for jobless benefits seemed to appease investors worried about the pace of the economic rebound.The U.S. data prompted investors to reduce their dollar holdings and buy other currencies such as the euro and Australian dollar.The better-than-expected data “has improved risk appetite on the margin and has added to the dollar’s somewhat negative tone this morning,” said Omer Esiner, senior currency analyst at Travelex Global Business Payments in Washington.”We’re seeing the dollar come off and trade at lows of the day across the board.”In late morning trading, the euro was up 0.2% against the dollar to 1.3964 after rising as high as 1.4002.The dollar rose 0.5% against the yen to ¥96.18. The Australian dollar, meanwhile, soared 1.2% versus the greenback to U.S.0.8020Euro/Swiss franc actionThe euro surged to 1.5140 francs on electronic trading platform EBS from 1.5008. It was last at 1.5119 francs, up 0.4% on the day.Several traders in the United States and London said they saw bids from the BIS in the currency market for the euro and offers to sell the Swiss franc. The BIS and SNB both declined to comment.”It looks like the BIS have been in … it’s probably fair to say it’s SNB-related,” a London-based trader said.The Swiss franc’s move came after the SNB held interest rates at a record low on Thursday, keeping its target rate for three-month Swiss franc LIBOR at 0.00-0.75% with an aim to lower it to 0.25%.SNB Governor Jean-Pierre Roth said he would continue to stop an irrational rise in the Swiss franc, but analysts said he did not confirm the SNB had acted beyond initial intervention after its last policy meeting on March 12 when the euro jumped to nearly 1.5350 francs from around 1.4750 francs.Analysts said some traders were testing the resolve of the SNB on intervention, and the market was figuring out how low the euro/Swiss franc pair had to fall before the central bank would enter the market.Another analyst at a U.S. currency firm said he noted a distinct change in tone from the SNB’s press conference on Thursday. “I think the ‘easy trade’ of buying EUR/CHF on the 1.50 handle has now run its course.”While this analyst would not suggest selling euro/Swiss, he strongly suggested exiting longs on the currency strength or at least tightening stops significantly.Markets were constantly on the alert for SNB action after the bank in March stunned the global foreign exchange market and bought euros and dollars versus the Swiss franc. Before that, the SNB had last physically intervened in August 1995.

Source:CNN