Oil slips towards US$77
Nov 24, 2009
WASHINGTON - OIL slipped towards US$77 (S$106) a barrel Tuesday as markets awaited data expected to show that the pace of US economic recovery is slower than previously estimated.
By early afternoon in Europe, benchmark crude for December delivery was down 12 cents to US$77.44 a barrel in electronic trading on the New York Mercantile Exchange.
The contract rose 9 cents to settle at US$77.56 on Monday.
The US government was due to report Tuesday on gross domestic product and consumer confidence.
Investors expected the data to show the economy is still growing, but at a slower pace than initially calculated.
Also, many analysts predict the economy will weaken again next year as the effect of stimulus packages wears off and the jobless rate dampens consumer spending.
Crude has bounced between US$76 a barrel and US$82 for more than a month as a weakening dollar offsets concerns about tepid consumer demand.
Oil often trades inversely to the strength of the dollar as investors buy commodities as a hedge against inflation.
Investor optimism was buoyed by a report Monday from the National Association of Realtors that October home sales rose more than 10 per cent, suggesting strength in the US economy.
On the other hand, crude refiner Valero Energy said it shut down a plant last week because demand for oil products such as gasoline has been weak. -- AP
Latest Stories »
