Oil prices rise on upbeat US economic data
2013-05-29 10:00:04
Global oil prices rallied Tuesday, supported by data showing an encouraging surge in US consumer confidence and home prices as markets reopened after a long holiday weekend.
New York's main contract, West Texas Intermediate light sweet crude for July delivery, closed at US$95.01 a barrel, up 86 cents from Friday.
In London trade, Brent North Sea crude for delivery in July jumped to US$104.23 a barrel, a hefty gain of US$1.61 from Monday's electronic trading on the IntercontinentalExchange.
Crude was "swept up by optimism, coming after a long weekend," said Matt Smith of Schneider Electric.
Better-than-expected economic news in the United States supported prices that already had been on their way up in tandem with equities markets. The New York and London oil markets closed off their highs.
US consumer confidence hit a five-year peak in May and home prices surged 11 per cent in March year-on-year, the biggest annual increase in nearly seven years.
"Ultimately US confidence levels have a lot to do with it," said Bart Melek of TD Securities, referring to raised expectations for stronger growth in the world's largest energy consumer.
Traders, meanwhile, were looking ahead to the Organization of Petroleum Exporting Countries meeting Friday but were not expecting any major policy changes, Melek said.
The oil producers cartel was expected to maintain its crude production ceiling of 30 million barrels per day as oil prices have steadied near US$100 a barrel after sharp falls earlier this year, analysts said.
Actual OPEC output has been exceeding the official target level.
Ministers from OPEC, which pumps about 35 per cent of global oil supplies, will convene in Vienna amid a weak outlook for global energy demand.
The new energy minister of OPEC member the United Arab Emirates, Suhail Al Mazrouei, said on Monday that current oil prices were "convenient and fair" and did not pose a threat to the global economy.