Wednesday, June 9, 2010

Crude Oil Rises for Second Day After Industry Shows Drop in U.S. Oil Inventories

Crude oil advanced for a second day as an industry report showed a drop in U.S. crude inventories and confidence among U.S. small businesses rose, bolstering optimism that fuel demand will increase in the world’s largest user. Oil gained as much as 1 percent after the American Petroleum Institute said crude inventories dropped for a second week.

An Energy Information Administration report today will probably show stockpiles fell 900,000 barrels, according to a Bloomberg News survey of 15 analysts. The National Federation of Independent Business’s optimism index increased last month to the highest level since September 2008.

“There is some optimism with the macro data, especially in the U.S.,” Ben Westmore, a minerals and energy economist at National Australia Bank Ltd. in Melbourne, said by telephone. “The last few weeks there’s been decent draws in the oil inventories in the U.S., and so the EIA data will be important to see if that trend continues.”

Crude oil for July delivery gained as much as 71 cents to $72.70 a barrel in electronic trading on the New York Mercantile Exchange, and was at $72.52 at 2:11 p.m. Singapore time. The contract rose 55 cents, or 0.8 percent, to settle yesterday at $71.99. Oil has declined 8.9 percent this year.

Risks to the global economic outlook have “risen significantly” and policy makers have limited room to provide support to growth, International Monetary Fund Deputy Managing Director Naoyuki Shinohara said in a speech in Singapore today.....Read the entire article.

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