Thursday, September 16, 2010

Crude Oil Falls on New York Manufacturing Numbers, Enbridge Line May Start This Week

Crude oil fell for a third day in New York after a U.S. government report showed fuel demand declined last week and as Enbridge Energy Partners LP prepared to start a pipeline after repairs, easing supply concerns. Crude dropped after the Energy Department said gasoline demand tumbled 2.6 percent to 9 million barrels a day, the lowest rate since the week ended March 12. Enbridge said it will start preparations to flow oil through a pipeline linking Canada and refineries in the U.S. Midwest early tomorrow. Manufacturing in the New York area expanded slower than forecast, signaling economic growth may falter.

“We’re not seeing as much consumption as we thought,” said Jonathan Barratt, managing director at Commodity Broking Services Pty in Sydney. “There is an oversupply of oil.” Crude for October delivery fell as much as $1.02, or 1.3 percent, to $75 a barrel in electronic trading on the New York Mercantile Exchange. It was at $75.24 at 2:45 p.m. Singapore time. Yesterday, the contract slipped 78 cents, or 1 percent, to $76.02. Futures have declined 5.2 percent this year.

Prices fell after the Federal Reserve Bank of New York’s general economic index slumped to 4.1 this month, the lowest since July 2009, from 7.1 in August. Economists expected the reading to climb to 8, according to a Bloomberg News survey. Houston based Enbridge won’t restart its Line 6A until the Pipeline and Hazardous Materials Safety Administration is satisfied with the company’s repair and safety plans, administration spokesman Damon Hill said in an e mail.....Read the entire article.

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