By Claudia Assis, MarketWatch
SAN FRANCISCO (MarketWatch) — Oil futures traded higher Friday, rebounding after crude had dropped its lowest since late November, following a report estimating the U.S. economy grew at a faster pace in the fourth quarter.
Crude for March delivery (CLH11 86.80, +1.16, +1.36%) gained $1.11, or 1.3%, to $86.76 a barrel on the New York Mercantile Exchange. On the week, oil has lost about 2.6%.
“The trend is still higher in the energy complex, but prices do seem to have gotten overextended here on the upside,” analysts at Cameron Hanover said in a note to clients on Friday.
“At the same time, it is increasingly confusing for investors, too. They used to be able to buy oil futures and then they could just bask in the glow of higher prices whenever the dollar dropped or equities rallied. Now, it just is not that clear cut any more,” they added.
Fourth-quarter gross domestic product grew 3.2%, just a tad away from expectations of 3.5% economists had expected. The growth was attributed to gains in consumer spending. Read more about fourth-quarter GDP
“We believe the potential for vehicle miles travelled in the US to rebound and take gasoline sales along for the ride could be a surprise to the markets. We therefore view the recent correction in oil prices as temporary,” analysts at Deutsche Bank said in a report to clients Friday.
Natural gas for March delivery (NGH11 4.36, +0.05, +1.04%) added 3 cents, or 0.6%, to $4.35 per million British thermal units, recouping some of the previous session’s 4% losses.
Prices have dropped 8% so far this week.
“As long as cold weather is being forecast out on the forecast horizon, this should continue to try to move higher more often than not,” the Cameron Hanover analysts said.
Reformulated gasoline for February (RBG11 2.39, -0.05, -1.94%) delivery added 1 cent, or 0.6%, to $2.40 a gallon. The March contract (RBH11 2.42, -0.05, -1.85%) also added a penny to $2.42 a gallon.
