Oil rebounds to above $101 a barrel

Oil rebounds to above $101 a barrel
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First Published: Fri, Sep 12 2008. 08 51 AM IST
Updated: Fri, Sep 12 2008. 08 51 AM IST
By Felicia Loo / Reuters
Singapore: Oil prices recovered to above $101 a barrel on Friday, as the markets kept a watchful eye on the path of Hurricane Ike that could disrupt refineries and production in the United States for weeks.
US crude for October delivery rose 45 cents to $101.37 a barrel by 0256 GMT, having settled down $1.71 a barrel on Thursday. Prices have fallen to $100.10 on Thursday, the lowest level since early April.
London Brent rose 61 cents to $98.25 a barrel, after dropping to a six-month low of $96.99 the previous day.
“This is a small price correction following heavy falls in recent days,” said David Moore, a commodity strategist at Commonwealth Bank of Australia from Sydney.
Prices had fallen toward $100 on Thursday amid soft global energy demand. A report that Saudi Arabia had no plans to cut output, despite Opec’s agreement this week to trim supply, also undermined prices.
But losses were reversed by Hurricane Ike, which nearly paralysed a quarter of US crude oil production and more than 16% of its refining capacity.
Oil markets continued to keep a careful eye on the storm, Moore said earlier in a daily note.
The storm menaced Houston, the fourth-most populous US city and hub of the oil industry, sparking worries of fuel shortages and the damage could leave some coastal refineries shut for weeks.
Stronger euro
Supporting prices further, the euro rebounded from one-year lows against the US dollar on Thursday due to comments from European Central Bank President Jean-Claude Trichet that inflation remained the bank’s key focus.
Oil kingpin Saudi Arabia has no plans to cut oil output at present unless customer demand falls, Saudi-owned daily Al Hayat said in an unsourced report on Thursday.
Traders will be looking towards U.S. economic indicators due out later on Friday including the August Producer Price Index, August retail sales data and the Economic Cycle Research Institute’s weekly index, to gauge how the economy of the world’s largest oil consumer is faring.
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First Published: Fri, Sep 12 2008. 08 51 AM IST
More Topics: Commodities | Oil | Brent Crude | Hurricane Ike | Nymex |