Oil traded in New York near the highest price in a week amid speculation that countries including the U.S. and China will add economic stimulus, countering signs of a slowdown threatening fuel demand.
Futures were little changed after three days of gains, the longest rising streak in three weeks. The Federal Reserve meets this week to discuss monetary policy in the U.S., the world’s biggest oil consumer, after the European Central Bank agreed last week on bond purchases to ease the euro area’s debt crisis. Net crude imports last month by China, the second-largest user, slid to the lowest level in almost two years amid slowing demand for the country’s goods, customs data showed today.
“The economy is weak,” said Jonathan Barratt, the chief executive officer of Barratt’s Bulletin, a commodity newsletter in Sydney. “The stimulus plans are designed to placate the market rather than improve the economies. You are putting in fire-power just to stop things falling.”
Crude for October delivery was at $96.16 a barrel in electronic trading on the New York Mercantile Exchange, down 26 cents, at 2:48 p.m. Singapore time. The contract climbed 89 cents, or 0.9 percent, to $96.42 on Sept. 7, the highest close since Aug. 31. Prices are 2.7 percent lower this year.
Brent oil for October settlement on the London-based ICE Futures Europe exchange was at $114.24 a barrel, down 1 cent. The European benchmark was at a premium of $18.09 to New York- traded West Texas Intermediate grade, up from $17.83 on Sept. 7.
Oil in New York has technical support along the middle Bollinger Band on the daily chart, around $94.08 a barrel today, according to data compiled by Bloomberg. Futures rebounded from this indicator in July and August. Buy orders tend to be clustered near chart-support levels.
China imported a net 18.2 million metric tons of crude in August, or about 4.3 million barrels a day, according to data published today on the website of the General Administration of Customs. That’s down 13 percent from a year earlier and the lowest rate since October 2010. Exports of goods rose 2.7 percent, missing the 2.9 percent forecast by economists in a Bloomberg News survey, the data showed. Industrial output increased at the slowest pace in three years last month, the government said yesterday.
Measures to support and stabilize foreign trade will be announced soon, according to an interview with Commerce Minister Chen Deming broadcast yesterday by China Central Television. China’s economic expansion faces “notable downward pressure,” President Hu Jintao said Sept. 8 at the Asia-Pacific Economic Cooperation CEO Summit in Vladivostok, Russia.
Japan’s gross domestic product rose an annualized 0.7 percent in the three months through June, the Cabinet Office said in Tokyo today, less than a preliminary calculation of 1.4 percent. The median forecast of 26 economists surveyed by Bloomberg News was for a revised 1 percent gain.
“The economy is the key thing that people are watching,” Robin Mills, the head of consulting at Dubai-based Manaar Energy Consulting and Project Management, said by telephone yesterday. “There’s some optimism about developments in the euro zone last week, though markets are more concerned about what looks like could be a slowdown in the economy in China.”
Money managers raised net-long positions in New York crude by 1,153, or 0.6 percent, to 193,624 futures and options combined in the seven days ended Sept. 4, according to a U.S. Commodity Futures Trading Commission report on Sept. 7.
To contact the reporter on this story: Ben Sharples in Melbourne at firstname.lastname@example.org