Crude Oil Futures Fluctuate Along With U.S. Equity Markets

Crude oil fluctuated along with equities as energy traders looked to stocks for signals of the strength of the economic recovery and fuel demand. Oil traded in a $1.66 range as stocks drifted between gains and losses after American International Group Inc. rose on the sale of a unit while drugmakers sank as President Barack Obama embarked on a final push to overhaul the health care system. An Energy Department report on March 10 will show that U.S. crude supplies climbed last week, a Bloomberg News survey showed.

“Until we get some solid statistics from the DOE on Wednesday, the market will look at equities for direction,” said Carl Larry, president of Oil Outlooks & Opinions LLC in Houston. Crude oil for April delivery rose 19 cents to $81.69 a barrel at 1:43 p.m. on the New York Mercantile Exchange. Futures touched $82.41, the highest level since Jan. 11. Prices are up 79 percent from a year earlier.

The Standard & Poor’s 500 Index gained 1.76, or 0.2 percent to 1,140.46. The Dow Jones Industrial Average increased 0.68 point to 10,566.88. “We are bouncing around with equities,” said Addison Armstrong, a director of market research at Tradition Energy in Stamford, Connecticut. “Crude oil is very much a follower and not trading on its own fundamentals.” Supplies of crude oil increased 2 million barrels last week, according to the median of 10 estimates from analysts surveyed by Bloomberg News.

Prices will probably fall to $60 a barrel during the fourth quarter of the year, Adam Sieminski, the chief energy economist at Deutsche Bank AG in Washington, said on Bloomberg Television. “The second half of the year could be weak because inventories are high, demand is still relatively weak, there’s plenty of supply and lots of OPEC spare capacity.” Brent crude for April delivery rose 40 cents, or 0.5 percent, to $80.29 a barrel on the London based ICE Futures Europe exchange. Oil reached $80.92, the highest level since Jan. 11.

Reporter Mark Shenk can be contacted at mshenk1@bloomberg.net


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