Commodity Corner: Oil, Natural Gas End the Week Higher
A positive change in a German business indicator helped to bolster the euro against the dollar Friday, which in turn gave crude oil a nice bump to end the week.
The price of a barrel of oil for November delivery settled at $76.49 a barrel, a $1.31 improvement from Thursday, after the Munich-based Ifo Institute for Economic Research announced a slight improvement in Germany's business climate for September. Using 100 as the seasonally adjusted benchmark, Ifo reported a business climate index of 106.8 for September 2010. In comparison, the figures for the preceding month and September 2009 were 106.7 and 91.3, respectively. The Ifo Business Survey revealed that manufacturing firms remain encouraged by export opportunities. However, they expect the pace of the export market to slow down six months out.
Oil also benefited from rallying equities markets. The Dow Jones was up 1.86% as of 4 p.m. Friday while the S&P 500 and Nasdaq were up 2.12% and 2.33%, respectively.
The intraday range for crude was $74.66 to $76.64, and oil ended the week up 2.2%.
The diminishing likelihood that Tropical Storm Matthew will affect oil and gas infrastructure in the Gulf of Mexico placed downward pressure on natural gas prices, which lost 14 cents Friday to settle at $3.88 per thousand cubic feet. Nevertheless, October natural gas ended the week 1.5% higher compared to the settlement price last Monday. Natural gas traded from $3.87 to $4.04 on Friday.
Gasoline for October delivery settled three cents higher at $1.95 a gallon. The front-month contract price fluctuated between $1.91 and $1.96. For the week, gasoline remained flat.