WTI Crude Oil Heads for Longest Gain Since April

West Texas Intermediate rose for a fifth day, its longest increase since April, on that signs of economic recovery in the U.S. and Germany will support fuel consumption.

WTI futures climbed as much 0.8 percent. German retail sales rose more than forecast in May, adding to signs that a recovery in Europe’s largest economy has gathered pace this quarter. Fewer Americans filed claims for weekly unemployment benefits and consumer spending rebounded in May, U.S. government data showed yesterday. Brent’s premium to WTI shrank after closing at the narrowest since January 2011.

“Oil trading is mostly macro-driven today,” said Andrey Kryuchenkov, an analyst at VTB Capital in London who sees WTI meeting “very strong resistance” next month at $99 a barrel. “Refinery runs in the U.S. are very healthy, but the upside for crude will still be limited by the long-term comfortable cushion of supply.”

WTI for August delivery increased as much as 77 cents to $97.82 a barrel in electronic trading on the New York Mercantile Exchange, the highest intraday price since June 20, and was at $97.33 at 1:28 p.m. London time. The contract rose $1.55, or 1.6 percent, to $97.05 yesterday, the biggest gain since May 3. Futures are up 5.8 percent this month and little changed in the second quarter.

Brent Gains

Brent for August settlement rose 27 cents to $103.09 a barrel on the London-based ICE Futures Europe exchange. The European benchmark crude was at a premium of $5.74 to WTI futures, from $5.77 yesterday. While Brent prices are up 2.6 percent in June, for the quarter the North Sea benchmark is poised for a third decline, its longest run of quarterly losses since 1998.

German economic data today from the Federal Statistics Office showed sales adjusted for inflation and seasonal swings climbed 0.8 percent in May from April. Economists had predicted an increase of 0.4 percent, according to the median of 23 estimates in a Bloomberg News survey. Sales gained 0.4 percent from a year earlier.

WTI is set for its first monthly advance this quarter, partly on renewed concern unrest in Syria will spread, threatening Middle East crude supplies. The region accounted for 33 percent of global production last year, according to BP Plc (BP/)’s Statistical Review of World Energy.

U.S. Economy

Crude gained yesterday after Commerce Department data showed U.S. consumer spending rebounded 0.3 percent in May following the biggest drop in more than three years. Weekly claims for jobless benefits slid for the third time in a month, according to a Labor Department report. The U.S. accounted for 21 percent of global oil consumption last year, according to BP’s Statistical Review.

U.S. stock-index futures rose, pointing to a fourth day of gains for the Standard & Poor’s 500 Index, and most commodities in the S&P GSCI gauge of 24 raw materials also gained today.

“Right now it seems like the bulls are in control,” said Victor Shum, the vice president at IHS Energy Insight, a consultant in Singapore. “Oil futures appear to be trading with the broader market.”

Prices may retreat next week on speculation U.S. oil and fuel inventories remain sufficient, a Bloomberg News survey showed. Thirteen of 33 analysts and traders, or 39 percent, forecast crude will decrease through July 5. Eleven respondents, or 33 percent, predicted an increase and nine saw no change. Last week, 65 percent projected a fall.

WTI has long-term technical support at $89.83 a barrel, according to data compiled by Bloomberg. That’s the 50 percent Fibonacci retracement of the drop to $32.40 in December 2008 from an intraday record high of $147.27 in July that year. Buy orders tend to be clustered near chart-support levels.

To contact the reporters on this story: Grant Smith in London at gsmith52@bloomberg.net

To contact the editor responsible for this story: Stephen Voss on sev@bloomberg.net

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