NEW YORK, Aug 9 (Reuters) - U.S. crude oil futures gained more than $2.50 a barrel in a sharp rally powered by signs of rising Chinese demand and concerns about supply disruptions in the Middle East.
Brent crude recovered from its lowest close in more than a month, but trading was more active in the New York market, with prompt-month September West Texas Intermediate (WTI) leading the gains.
The premium for September crude over December futures widened by 70 cents to $3.60, intensifying a market structure known as backwardation. Analysts cited upbeat data from China and more signs of a sharp fall-off in Libyan oil exports as possible causes for the appreciation of front contracts.
Market watchers also said that a rush to secure long positions in the front month contract ahead of the weekend also contributed to the rally.
"We're bouncing back from five sessions of losses," said Joseph Posillico, senior vice president of energy derivatives at Jefferies Bache in New York. He said "the bullish numbers are pushing us up" and traders "generally go long in the front two months, and that's going to lend strength in the spreads as well."
U.S. oil futures for September delivery climbed $2.57 to settle at $105.95. Brent crude oil rose $1.54 cents to $108.22. The North Sea benchmark's premium to its U.S counterpart narrowed to $2.25 at settlement time.
China's factory output grew in July at its fastest pace since the start of the year, adding to a run of data suggesting the world's second-largest economy may be stabilising after more than two years of slumping growth. Crude oil imports rose to a record, although implied oil demand softened from a four-month high in June.
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