Oil Rises Above $70 as Economic Growth May Bolster Fuel Use
June 15 -- Crude oil rose above $70 a barrel in New York as robust economic growth in the U.S. and China, the two biggest oil consumers, may bolster fuel demand.
A report from the Federal Reserve Bank of New York suggested that manufacturing in the state is rebounding. First-time claims for unemployment benefits in the U.S. fell last week, a separate report showed. Chinese industrial output rose 17.9 percent in May, the most in two years, a government report showed yesterday. The U.S. and China consume 33 percent of the world's oil.
``We've been trending higher but prices picked up with the release of economic data,'' said Jason Schenker, an economist at Wachovia Corp. in Charlotte, North Carolina. ``Increased economic growth implies stronger fuel demand.''
Crude oil for July delivery rose 96 cents, or 1.4 percent, to $70.10 a barrel at 10:50 a.m. on the New York Mercantile Exchange. Prices are up 26 percent from a year ago. Oil reached $75.35 on April 21 and 24, the highest since New York trading began in 1983. Futures touched $68.109 yesterday, the lowest since May 22.
``Prices pulled back on economic jitters but it now appears that some of those worries were overblown,'' said John Kilduff, vice president of risk management at Fimat USA in New York. ``The figures from China are showing that the economy and fuel demand are booming. Oil below $70 now looks like a good buying opportunity.''
China imported 19 percent more crude oil in May than a year earlier, bringing in 12.4 million tons, the Customs General Administration said June 12.
Natural Gas Inventories
The climb accelerated after a government report showed that U.S. inventories of natural gas rose by 77 billion cubic feet to 2.397 trillion cubic feet last week. The gain was less than the median forecast for an increase of 86 billion cubic feet, according to a Bloomberg survey of 18 analysts.
Some manufacturers and utilities can switch between oil- based fuels and natural gas depending on costs.
Kuwait, the Organization of Petroleum Exporting Countries' fifth-biggest oil producer, expects prices to stabilize between $65 and $70 a barrel, the nation's Oil Minister Sheikh Ahmad Fahd al-Sabah said in New Delhi today. The minister is accompanying Kuwait's Emir Sabah al-Ahmad al-Sabah on an official visit to India this week.
OPEC will continue to ensure supplies of oil to the world so that economic growth is not stunted, Sheikh Ahmad said. The producer group has kept output targets unchanged at 28 million barrels a day for 10 months.
Iranian Cooperation
Iran, the fourth-biggest oil producer, has reduced cooperation with United Nations atomic agency inspectors since the announcement of a U.S.-backed offer of incentives tied to the shutdown of nuclear-fuel production, European Union diplomats said today. Oil has risen 14 percent this year in part on concern that Iranian shipments may be cut as nuclear tension increases.
``Cooperation with the agency has been reduced to almost nothing,'' said Francois-Xavier Deniau, the French ambassador to the UN's International Atomic Energy Agency in Vienna. He was delivering a statement on behalf of the EU.
Brent crude oil for July settlement rose 82 cents, or 1.2 percent, to $67.80 a barrel on the London-based ICE Futures exchange. Futures touched $74.97 a barrel May 2 and 3, the highest since the contract began trading in 1988.
June 15 -- Crude oil rose above $70 a barrel in New York as robust economic growth in the U.S. and China, the two biggest oil consumers, may bolster fuel demand.
A report from the Federal Reserve Bank of New York suggested that manufacturing in the state is rebounding. First-time claims for unemployment benefits in the U.S. fell last week, a separate report showed. Chinese industrial output rose 17.9 percent in May, the most in two years, a government report showed yesterday. The U.S. and China consume 33 percent of the world's oil.
``We've been trending higher but prices picked up with the release of economic data,'' said Jason Schenker, an economist at Wachovia Corp. in Charlotte, North Carolina. ``Increased economic growth implies stronger fuel demand.''
Crude oil for July delivery rose 96 cents, or 1.4 percent, to $70.10 a barrel at 10:50 a.m. on the New York Mercantile Exchange. Prices are up 26 percent from a year ago. Oil reached $75.35 on April 21 and 24, the highest since New York trading began in 1983. Futures touched $68.109 yesterday, the lowest since May 22.
``Prices pulled back on economic jitters but it now appears that some of those worries were overblown,'' said John Kilduff, vice president of risk management at Fimat USA in New York. ``The figures from China are showing that the economy and fuel demand are booming. Oil below $70 now looks like a good buying opportunity.''
China imported 19 percent more crude oil in May than a year earlier, bringing in 12.4 million tons, the Customs General Administration said June 12.
Natural Gas Inventories
The climb accelerated after a government report showed that U.S. inventories of natural gas rose by 77 billion cubic feet to 2.397 trillion cubic feet last week. The gain was less than the median forecast for an increase of 86 billion cubic feet, according to a Bloomberg survey of 18 analysts.
Some manufacturers and utilities can switch between oil- based fuels and natural gas depending on costs.
Kuwait, the Organization of Petroleum Exporting Countries' fifth-biggest oil producer, expects prices to stabilize between $65 and $70 a barrel, the nation's Oil Minister Sheikh Ahmad Fahd al-Sabah said in New Delhi today. The minister is accompanying Kuwait's Emir Sabah al-Ahmad al-Sabah on an official visit to India this week.
OPEC will continue to ensure supplies of oil to the world so that economic growth is not stunted, Sheikh Ahmad said. The producer group has kept output targets unchanged at 28 million barrels a day for 10 months.
Iranian Cooperation
Iran, the fourth-biggest oil producer, has reduced cooperation with United Nations atomic agency inspectors since the announcement of a U.S.-backed offer of incentives tied to the shutdown of nuclear-fuel production, European Union diplomats said today. Oil has risen 14 percent this year in part on concern that Iranian shipments may be cut as nuclear tension increases.
``Cooperation with the agency has been reduced to almost nothing,'' said Francois-Xavier Deniau, the French ambassador to the UN's International Atomic Energy Agency in Vienna. He was delivering a statement on behalf of the EU.
Brent crude oil for July settlement rose 82 cents, or 1.2 percent, to $67.80 a barrel on the London-based ICE Futures exchange. Futures touched $74.97 a barrel May 2 and 3, the highest since the contract began trading in 1988.
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