Oil prices steady above $93 a barrel amid thin holiday trading

Oil prices steady above $93 a barrel amid thin holiday trading


Singapore: Oil prices were little changed on 24 December amid light trading due to holidays, and after rising more than $2 a barrel in the previous session on news of improved U.S. consumer spending.

Light, sweet crude for February delivery lost 5 cents to $93.26 a barrel in electronic trading on the New York Mercantile Exchange, midmorning in Singapore.

Japanese financial markets were closed on 24 December for the Emperor’s birthday, a national holiday, while trading on some other Asian markets ended early for Christmas Eve. Markets in the U.S. and many other countries will be closed on 25 December for Christmas.

On 21 December, the Nymex crude contract rose $2.25 to settle at $93.31 a barrel after the U.S. government reported that consumer spending surged last month, raising hopes that the American economy will weather the crisis roiling credit markets and that demand for oil and gasoline will strengthen.

Oil prices were also supported by stocks, which rose on 21 December, and a slightly weaker dollar. Energy investors often view stock market moves as reflective of overall economic sentiment. Also, oil futures offer a hedge against a weak dollar, and oil futures bought and sold in dollars are more attractive to foreign investors when the greenback is falling. Many observers blame oil’s rise last month to near $100 on speculators driven to oil futures by the weaker dollar.

Crude futures have since retreated as OPEC boosted supplies and several forecasters cut demand predictions. But in recent weeks, prices have held generally to a range between $87 and $93, leading some analysts to conclude investors are seeking direction and may be poised to make another push for $100 a barrel in the new year.

Heating oil futures fell 0.94 cent to $2.5997 a gallon (3.8 liters) while gasoline prices were flat at $2.3795 a gallon. Natural gas futures dropped 13.1 cents to $7.059 per 1,000 cubic feet. In London, February Brent crude fell 4 cents to $92.42 a barrel on the ICE Futures exchange.