Crude oil declined the most in two weeks after a report showed that confidence among U.S. consumers unexpectedly dropped this month. Oil fell as much as 1.7 percent as the Reuters/University of Michigan preliminary consumer sentiment index dropped to 72.5 from February’s reading of 73.6. A gain to 74 was forecast, according to the median of 68 estimates in a Bloomberg News survey. Prearranged orders to sell oil at specific prices, known as stops, may have been triggered when oil breached today’s low.
“The selling started after the consumer confidence numbers were released,” said Addison Armstrong, director of market research at Tradition Energy in Stamford, Connecticut. “The market has been tenuous and once we started working lower the move gathered strength. We’ve taken out some stops and are looking to test more.” Crude oil for April delivery fell $1.16, or 1.4 percent, to $80.95 a barrel at 12:27 p.m. on the New York Mercantile Exchange. Prices touched $83.16, the highest level since Jan. 11. Futures are little changed this week and are 72 percent higher than a year ago.
Brent crude oil for April delivery declined $1.24 cents, or 1.5 percent, to $79.04 a barrel on the London based ICE Futures Europe exchange. Prices climbed earlier as retail sales gained. The Commerce Department reported that purchases gained 0.3 percent last month. A 0.2 percent decline was projected, according economists surveyed by Bloomberg News. “There’s a rush to interpret every new piece of economic data,” said Michael Fitzpatrick, vice president of energy at MF Global in New York. “We did reach $83.16, a new high, but otherwise today is a sleeper.”
Reporter Mark Shenk can be reached at mshenk1@bloomberg.net
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