Crude oil traded near a seven-week high as signs the global economy is recovering from recession bolstered optimism that fuel consumption will bounce back, Bloomberg reported.
Crude oil for September 2009 delivery was at $71.37 a barrel, down $0.21, on the New York Mercantile Exchange at 11.17am Singapore time. On 3 August it rose $2.13, or 3.1%, to $71.58, the highest settlement since 12 June.
Crude oil was higher than $70 a barrel in New York after reports showed that US manufacturing shrank at the slowest pace in 11 months and factory production in China advanced to the highest level in almost a year.
The Standard & Poor’s 500 Index increased above 1,000 for the first time since November 2008, prompting speculation that raw material demand and prices will rise.
Yesterday, the US Institute for Supply Management said that its manufacturing index increased to 48.9 last month from 44.8 in June. An increase to 46.5 was expected, according to a Bloomberg News survey of economists.
CLSA Asia-Pacific Markets said that its index of China’s manufacturing rose to a one-year high as stimulus spending stoked domestic demand. China accounts for about 45% of Asia’s oil use.
Brent crude oil for September 2009 settlement was at $73.43, down $0.12, on London’s ICE Futures Europe Exchange at 11.18am in Singapore. On 3 August the contract gained $1.85, or 2.6%, to close at $73.55 a barrel.