Spurred by increased economic optimism in the broader financial market, crude futures surged to just under $80 a barrel on the New York Mercantile Exchange Tuesday, ahead of tomorrow's weekly inventory data.
Rallying alongside equities at the start of the session, the price of light, sweet crude oil for April delivery rebounded from yesterday's sell off to nearly $81 during an intra-day high, but ultimately settled just below its threshold at $79.68 a barrel.
Likewise, gasoline futures pushed back into positive territory to settle higher at $2.20 a gallon. Today, MasterCard SpendingPulse reported that U.S. retail gasoline demand was up by 0.3% in the week to Feb. 26 from the previous week.
"Oil prices closed higher on some light volume for a number of reasons," noted Phil Flynn, vice president in charge of research for PFG Best in Chicago.
"The oil market had a tendency to be strong because the stock market was strong earlier in the session," the analyst continued. "Also, because of uncertainty in the currency market and a surge in gold, traders were running to oil almost as a safe haven."
Citing a slight break down in equities coming out of the session, Flynn contended that today's rally in oil futures was not built on a solid foundation and does not see near-term prices sustaining above $80 a barrel.
However, some analysts believe the recent uptick in the price per barrel of crude oil indicates the market's seasonal shift in focus to the upcoming driving season, slated to begin at the end of May and to peak in the summer months from June-July.
Inching back toward a $5-pointmark, natural gas at the Henry Hub also saw a lift in today's spot price to $4.71 Mcf.
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