Commodity Corner: Oil Rebounds to $81.48
Reports of higher unemployment contributed to a down week for oil last week, but the commodity settled higher Monday on expectations of more favorable news relating to the economy.
The price of a barrel of crude for September delivery ended the day at $81.48, a 78-cent improvement from Friday. Traders were optimistic that the Federal Reserve would unveil new measures to stimulate the U.S. economy when it meets on Tuesday. Additional factors that could influence demand this week include two tropical systems in the Atlantic Basin one in the southeastern Gulf of Mexico and another northeast of the Leeward Islands. According to the National Hurricane Center, the system in the Gulf has a medium (30%) chance of strengthening into a tropical or subtropical cyclone by Wednesday afternoon. Meanwhile, the system in the open Atlantic Ocean has a high (70%) probability of becoming a tropical cyclone during the same period.
Crude oil traded from $80.71 to $81.76 Monday.
The National Weather Service's prediction of above-normal temperatures for much of the U.S. over the next 30 days failed to provide a boost to natural gas futures. The front-month price for gas slipped 16 cents to settle at $4.31 per thousand cubic feet on Monday as ample supplies counteracted any bump that might otherwise stem from the weather forecast. The intraday range for natural gas was $4.28 to $4.55.
The price of a gallon of gasoline for September delivery rose a penny Monday to settle at $2.12. Gasoline remained within a band from $2.11 to $2.14 on the first trading day of the week.