U.S. crude oil futures snapped a three-day losing streak to end higher Tuesday, ahead of the crucial OPEC meet to decide on production levels later this week. Investors were also swayed by hopes of further quantitative easing as eurozone woes continued unabated with yields on Spanish and Italian bond surging to record levels. Nonetheless, markets continued to be dodged with contagion fears in the eurozone over its debt, amid uncertainty over bailout plans for the Spanish banking system.
Light Sweet Crude Oil futures for July delivery, gained $0.62 or 0.8 percent to close at $83.32 a barrel on the New York Mercantile Exchange Tuesday.
Crude prices scaled a high of $83.72 a barrel intraday and a low of $81.07.
Oil extended losses yesterday on demand growth concerns, as the news of a bailout plan for Spain's banking sector failed to enthuse traders.
The Organization of the Petroleum Exporting Countries, in its monthly oil market report released today, maintained its world oil demand growth forecast for 2012 but cautioned that economic developments world-wide had placed a great amount of uncertainty on oil demand.
The dollar index, which tracks the U.S. unit against six major currencies, was trading at 82.526 on Tuesday, slightly down from 82.529 in North American trade late Tuesday. The dollar scaled a high of 82.73 intraday and a low of 82.33.
The euro traded lower against the dollar at $1.2481 on Tuesday, as compared to $1.2495 late Monday. The euro scaled a high of $1.2530 intraday and a low of 1.2444.
In economic news, U.S. import prices fell sharply in May driven by a steep drop in fuel prices, data from the Labor Department said. Prices for U.S. exported goods fell for the first time in 2012. The overall price index for U.S. imports dropped by 1 percent in May, the largest monthly drop since June 2010. Most economists expected a somewhat bigger 1.1 percent decline in the costs of imported goods.
On a year-over-year basis prices, for imported goods were down 0.3 percent, marking the first 12-month decline recorded since a 5.6 percent drop in October of 2009. Export prices, which had increased by 2 percent over the first four months of the year, fell 0.4 percent in May, the first monthly decline of 2012.
From Europe, U.K. manufacturing output dipped 0.7 percent month-on-month in April, reversing the 0.9 percent rise in March, the Office for National Statistics said. The decline far exceeded economists' forecast of 0.1 percent decline. Industrial production remained flat on month versus a 0.3 percent fall in the prior month. Economists expected a 0.1 percent rise for April.
On focus today, would be the data on crude oil inventories from the American Petroleum Institute, while the more closely followed Energy Information Administration U.S. oil stockpile report is due Wednesday.
by RTT Staff Writer
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