BLBG: Oil Rises for First Time in 3 Days as U.S. Retail Sales Jump
By Mark Shenk
Sept. 15 (Bloomberg) -- Crude oil rose for the first time in three days as sales at U.S. retailers surged in August by the most in three years and manufacturing in the New York region grew, signaling the economy is recovering from the recession.
Oil climbed as much as 1.7 percent after Commerce Department figures showed that consumers took advantage of the government’s “cash-for-clunkers” program. An Energy Department report tomorrow is forecast to show that U.S. crude-oil supplies fell for a third week, according to a Bloomberg News survey.
“You are seeing increased buying on today’s positive economic numbers,” said Peter Beutel, president of trading adviser Cameron Hanover Inc. in New Canaan, Connecticut. “There will be a lot of positioning by traders in advance of the inventory reports.”
Crude oil for October delivery rose 54 cents, or 0.8 percent, to $69.40 a barrel at 12:26 p.m. on the New York Mercantile Exchange. Prices are up 56 percent this year.
The Federal Reserve Bank of New York’s general economic index increased to 18.9 from 12.1 in August, the bank said today. Last month’s report was the first time since April 2008 that the reading was above zero, the dividing line between expansion and contraction for the Empire State index.
Crude oil tumbled to $32.40 a barrel in December, the lowest price in more than four years, after the collapse of Lehman Brothers Holdings Inc. on Sept. 15, 2008, triggered a global financial crisis that sapped energy demand.
Inventory Forecast
U.S. inventories of crude oil declined 2.5 million barrels from 337.5 million in the week ended Sept. 11, according to the median of 15 estimates by analysts surveyed before tomorrow’s Energy Department report.
Gasoline stockpiles probably rose 700,000 barrels from 207.2 million the week before, the survey showed. Supplies of distillate fuel, a category that includes heating oil and diesel, climbed 1.25 million barrels from 165.6 million the prior week, the survey showed.
The Energy Department is scheduled to release its Weekly Petroleum Status Report at 10:30 a.m. in Washington tomorrow. The industry-funded American Petroleum Institute will publish its own data later today.
The Organization of Petroleum Exporting Countries raised its global oil consumption forecasts for this year and 2010 in a report today. The group increased its 2010 outlook by 150,000 barrels a day and 2009 by 140,000 barrels a day. OPEC estimates that demand will contract 1.8 percent this year to average 84.05 million barrels a day, and then rise 0.6 percent in 2010 to 84.56 million a day.
Nigerian Cease Fire
The main militant group in Nigeria said it will end its 60- day cease-fire today as it threatened to resume sabotage attacks “with utmost zeal.”
The Movement for the Emancipation of the Niger Delta, or MEND, which seeks more local control of the delta’s oil wealth, declared a unilateral cease-fire July 15 after the government freed its leader, Henry Okah, who was on trial for treason. MEND rejected a government amnesty program, saying it failed to address its political demands.
Brent crude oil for October settlement fell 54 cents, or 0.8 percent, to $66.90 a barrel on the London-based ICE Futures Europe exchange. The October contract expires today. The more active November futures contract climbed 1 cent to $68.38 a barrel.
