Oil Falls for First Time in Four Days
West Texas Intermediate crude fell for the first time in four days on speculation that prices climbed more than justified last week.
Futures declined as much as 0.8 percent in New York as U.S. equity indexes were little changed after advancing for four straight weeks. Oil futures and equities surged last week on signs that U.S. economic growth will accelerate, bolstering demand for fuel.
“Crude oil and other risk assets were a little overcooked,” said Bob Yawger, director of the futures division at Mizuho Securities USA Inc. in New York. “The rally in equities and oil at the end of the week isn’t sustainable.”
WTI oil for June delivery fell 51 cents, or 0.5 percent, to $95.51 a barrel at 9:17 a.m. on the New York Mercantile Exchange. Prices rose 86 cents to $96.02 on May 17, the highest settlement since May 10. The volume of all contracts traded was 15 percent below the 100-day average for this time of day.
June futures expire tomorrow. The more-active July contract slid 51 cents, or 0.5 percent, to $95.78.
Brent for July settlement dropped 60 cents, or 0.6 percent, to $104.04 a barrel on the London-based ICE exchange. Volume for all contracts was 49 percent lower than the 100-day average. The front-month European benchmark was at a premium of $8.26 to WTI contract for the same month.
The Standard & Poor’s 500 Index, which increased to a record 1,667.47 on May 17, was little changed at 1,667.90 at 9:40 a.m.
WTI advanced to $96.26 in earlier trading as Syrian government forces started an offensive against rebels. Government troops retook most of the strategic city of Al-Qusair in central Syria, state-run SANA news agency said.
Speculative bets that Brent prices will rise, in futures and options combined, outnumbered short positions by 130,219 lots in the week ended May 14, ICE said today in its weekly Commitment of Traders report. The gain of 6,184 contracts, or 5 percent, is a third straight weekly increase and brings net-long positions to the highest since April 2.
Money managers increased net-long positions, or wagers on higher prices, in WTI by 606 futures and options combined, or 0.3 percent, to 205,140, in the seven days ended May 14, according to the Commodity Futures Trading Commission’s May 17 Commitments of Traders report. It was the third weekly gain.
To contact the editor responsible for this story: Dan Stets at email@example.com