Oil climbed for a fifth day in New York, the longest streak of gains in a month, on signs of a strengthening U.S. economy and speculation that higher Saudi Arabian crude output indicates increasing demand for fuel.
Futures gained as much as 0.5 percent after closing at a three-month high on Aug. 17 as a report showed U.S. consumer confidence unexpectedly improved. Home sales and orders for durable goods probably climbed in July, economists said before figures this week. Saudi Arabia pumped crude at the highest level in more than three decades in June and monthly exports were the most since November 2005, according to the Joint Organization Data Initiative.
“Oil has been aided by the pickup in consumer confidence in the U.S.,” said Ric Spooner, a chief market analyst at CMC Markets in Sydney. The increase in Saudi production shows “the supply capacity is there to meet increased demand,” he said.
Crude for September delivery advanced as much as 52 cents to $96.53 a barrel and was at $96.29 in electronic trading on the New York Mercantile Exchange at 4:55 p.m. Sydney time. It rose 0.4 percent to $96.01 on Aug. 17, the highest close since May 11. The contract expires tomorrow. The more-actively traded October future was at $96.57. Oil’s run of gains is the longest since the seven days ended July 19. Front-month prices are 2.6 percent lower this year.
Brent oil for September settlement climbed 42 cents, or 0.4 percent, to $114.13 a barrel on the London-based ICE Futures Europe exchange. The European benchmark grade’s premium to West Texas Intermediate was at $17.84, from $17.39 on Aug. 17.
Saudi Arabia’s output increased 3 percent to 10.1 million barrels a day in June from May, according to data submitted by the government to the Organization of Petroleum Exporting Countries and posted on JODI’s website yesterday. Exports were at 7.84 million barrels a day. The Middle East nation overtook Russia, which pumped 9.9 million barrels a day, as the world’s largest oil producer during the month, the data showed.
Combined purchases of new and existing homes in the U.S. increased to a 4.89 million annual rate from a 4.72 million pace in June, according to the median forecast in a Bloomberg survey. The National Association of Realtors will release existing sales on Aug. 22, with the Commerce Department publishing data on new sales the next day.
Durable goods orders probably rose 3 percent in July, the most since December, according to the median estimate in a Bloomberg survey before a Commerce Department report on Aug. 24.
The Thomson Reuters/University of Michigan preliminary August index of consumer sentiment rose to 73.6, the highest level since May, from 72.3 the prior month. The gauge was projected to be little changed at 72.2, according to the median forecast of 72 economists surveyed by Bloomberg.
Net-long positions in oil held by money managers, including hedge funds, commodity pools and commodity trading advisers, retreated by 11,764, or 7.2 percent, to 152,222 futures and options combined in the seven days ended Aug. 14, according to the Commodity Futures Trading Commission’s Commitments of Traders report on Aug. 17.