June 23, 2010, 2:29 AM EDT
By Ben Sharples and Yee Kai Pin
June 23 (Bloomberg) -- Crude oil fell for a second day in New York amid speculation rising supplies in the U.S. and a surprise drop in home sales signaled the world’s largest energy consumer may be struggling to sustain a recovery.
Oil extended yesterday’s 1 percent decline after the National Association of Realtors reported existing-homes sales fell 2.2 percent in May, missing economist estimates. Crude stockpiles increased 3.69 million barrels last week to a three- week high, according to the industry-funded American Petroleum Institute. An Energy Department today may report a drawdown.
“Sentiment remains very fragile,” said David Moore, a commodity strategist at Commonwealth Bank of Australia Ltd. in Sydney. “Confidence has been rattled in recent months by European fiscal issues and by data in the U.S. that’s been uneven. They’re factors that have left markets cautious.”
Crude for August delivery fell as much as 81 cents, or 1 percent, to $77.04 a barrel in electronic trading on the New York Mercantile Exchange. It was at $77.44 at 2:20 p.m. Singapore time. Yesterday, the contract lost 76 cents to settle at $77.85.
The July contract dropped 61 cents, or 0.8 percent, to settle at $77.21 a barrel and expired at the close of floor trading. Futures are down 2.5 percent this year.
Oil Supplies
“I don’t think the oil market is tight at present, inventories remain high,” said Moore at Commonwealth Bank of Australia. Yesterday’s API data showed “crude stocks were up quite a bit, distillate stocks were up, and gasoline supplies were up,” he said.
Crude supplies at Cushing, Oklahoma, the delivery point for the New York futures, gained 386,000 barrels to 38 million, the API said. That’s 36,000 barrels below a record reported for the week to May 14.
Gasoline stockpiles had a 810,000-barrel gain to 221.2 million, the highest in five weeks, according to the API. Distillates increased 1.1 million barrels to 154.7 million, a four-month high.
Brent Oil
Brent crude for August delivery dropped as much as 73 cents, or 0.9 percent, to $77.31 a barrel on the London-based ICE Futures Europe exchange. It was at $77.79 at 2:23 p.m. Singapore time. Yesterday, the contract dropped 78 cents, or 1 percent, to $78.04, the lowest settlement in five days.
Crude extended declines after a New Orleans federal judge lifted a six-month moratorium on deepwater drilling imposed by President Barack Obama following the largest oil spill in U.S. history.
Obama temporarily halted all drilling in waters deeper than 500 feet on May 27 for a presidential commission to study safety improvements for offshore operations. More than a dozen Louisiana offshore service and supply companies sued regulators to lift the ban. The government said it would appeal yesterday’s decision.
Source: http://www.businessweek.com/news/2010-06-23/oil-falls-a-second-day-as-u-s-stockpiles-rise-home-sales-drop.html
By Ben Sharples and Yee Kai Pin
June 23 (Bloomberg) -- Crude oil fell for a second day in New York amid speculation rising supplies in the U.S. and a surprise drop in home sales signaled the world’s largest energy consumer may be struggling to sustain a recovery.
Oil extended yesterday’s 1 percent decline after the National Association of Realtors reported existing-homes sales fell 2.2 percent in May, missing economist estimates. Crude stockpiles increased 3.69 million barrels last week to a three- week high, according to the industry-funded American Petroleum Institute. An Energy Department today may report a drawdown.
“Sentiment remains very fragile,” said David Moore, a commodity strategist at Commonwealth Bank of Australia Ltd. in Sydney. “Confidence has been rattled in recent months by European fiscal issues and by data in the U.S. that’s been uneven. They’re factors that have left markets cautious.”
Crude for August delivery fell as much as 81 cents, or 1 percent, to $77.04 a barrel in electronic trading on the New York Mercantile Exchange. It was at $77.44 at 2:20 p.m. Singapore time. Yesterday, the contract lost 76 cents to settle at $77.85.
The July contract dropped 61 cents, or 0.8 percent, to settle at $77.21 a barrel and expired at the close of floor trading. Futures are down 2.5 percent this year.
Oil Supplies
“I don’t think the oil market is tight at present, inventories remain high,” said Moore at Commonwealth Bank of Australia. Yesterday’s API data showed “crude stocks were up quite a bit, distillate stocks were up, and gasoline supplies were up,” he said.
Crude supplies at Cushing, Oklahoma, the delivery point for the New York futures, gained 386,000 barrels to 38 million, the API said. That’s 36,000 barrels below a record reported for the week to May 14.
Gasoline stockpiles had a 810,000-barrel gain to 221.2 million, the highest in five weeks, according to the API. Distillates increased 1.1 million barrels to 154.7 million, a four-month high.
Brent Oil
Brent crude for August delivery dropped as much as 73 cents, or 0.9 percent, to $77.31 a barrel on the London-based ICE Futures Europe exchange. It was at $77.79 at 2:23 p.m. Singapore time. Yesterday, the contract dropped 78 cents, or 1 percent, to $78.04, the lowest settlement in five days.
Crude extended declines after a New Orleans federal judge lifted a six-month moratorium on deepwater drilling imposed by President Barack Obama following the largest oil spill in U.S. history.
Obama temporarily halted all drilling in waters deeper than 500 feet on May 27 for a presidential commission to study safety improvements for offshore operations. More than a dozen Louisiana offshore service and supply companies sued regulators to lift the ban. The government said it would appeal yesterday’s decision.
Source: http://www.businessweek.com/news/2010-06-23/oil-falls-a-second-day-as-u-s-stockpiles-rise-home-sales-drop.html
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