Commodity Corner: Oil Bounces Back
One day after closing at its weakest point since September 23, 2010, light sweet crude oil gained 5.3 percent.
The November WTI contract price ended the day at $79.68 a barrel after trading within a range from $76.94 to $79.82. The Brent also posted a gain Wednesday, returning to triple-digit territory to settle at $102.73 a barrel. Intraday Brent prices ranged from $101.08 to $102.80.
Oil futures rallied on an unexpectedly bullish weekly inventories report from the U.S. Energy Information Administration (EIA). EIA announced that U.S. commercial crude oil stocks fell nearly 1.4 percent to 336.3 million barrels last week. The EIA figure represents a 4.7 million-barrel draw. Analysts surveyed by Platts had projected a 2.5 million-barrel build.
Rallying equities markets added momentum to oil futures Wednesday, with major averages advancing on positive employment news. According to payroll processor ADP, U.S. private-sector employment grew by 91,000 jobs last month. Dow Jones Industrials rose by 1.21 percent while the S&P 500 and Nasdaq increased by 1.79 percent and 2.32 percent, respectively. European indexes such as the FTSE 100 and CAC 40 posted even stronger gains, bolstered by reports that euro-zone finance officials were exploring how to shore up the region's struggling banks.
November natural gas lost seven cents to end the day at $3.57 per thousand cubic feet after trading from $3.55 to $3.69. Front-month reformulated gasoline settled at $2.57 a gallon, representing an eight-cent day-on-day gain. The November contract peaked at $2.57 and bottomed out just under $2.52.