Oil rose in New York, heading for the second week of gains, on speculation Europe may contain its debt crisis and the U.S. economy will recover, bolstering demand for raw materials.
Prices gained as much as 0.8 percent, reversing earlier declines, before Commerce Department data forecast to say U.S. retail sales last month climbed at the fastest pace in six months, according to a Bloomberg survey of economists. Oil and equity futures rallied before Group of 20 finance ministers meet to discuss Europe’s debt crisis. Technical indicators showed New York crude was oversold.
“The oil markets moving up or pulling down is dependent on the stock and financial markets,” said Ken Hasegawa, a commodity derivatives trading manager at broker Newedge in Tokyo. “Some of the U.S. data has been good recently. I don’t think the markets will move up sharply as there is still a lot of fear.”
Crude for November delivery climbed as much as 71 cents to $84.94 a barrel in electronic trading on the New York Mercantile Exchange. It was at $84.61 at at 3:23 p.m. Singapore time. The contract fell 1.6 percent yesterday to the lowest close since Oct. 7. Prices are down 7.4 percent this year and up 2 percent for the week.
Brent oil for November settlement rose 33 cents, or 0.3 percent, to $111.44 a barrel on the London-based ICE Futures Europe exchange. The European benchmark future, which expires today, was at an intraday premium of $26.61 to U.S. crude, compared with yesterday’s record close of $26.88. The more-active December contract was up 24 cents at $109.44.
Oil is also rising in New York as stochastic oscillators on the weekly technical chart show futures remain oversold, according to data compiled by Bloomberg. The price advance may continue, with prices rising as high as $88.86 a barrel, the lower of two leading-span lines that define a so-called “ichimoku cloud” on the weekly chart. The cloud is an area where buy orders may be clustered.
U.S. retail sales may have climbed 0.7 percent in September, according to a Bloomberg News survey of economists before a report out today. That’s up from little changed in August. Crude gained as equities on the Euro Stoxx 50 Index advanced 0.6 percent. Futures on the Standard & Poor’s 500 Index were little changed, while Nasdaq-100 Index contracts rose 0.1 percent.