Metals News
Crude Oil Trades Near $73 in New York Amid Concerns Over Demand
data analysis
08:51AM
Feb 1,2010
Source:SMM

NEWYORK, Feb. 1-- Crude oil traded near $73 a barrel after four days of decline in New York amid concern that fuel demand may be slow to recover in the U.S., the biggest energy- consuming nation.

Oil may extend its slump as U.S. supplies climb and demand lags behind year-earlier levels, a Bloomberg News analyst survey showed Jan 29. Prices fell last week as the dollar rose to a six-month high against the euro, limiting the need for commodities to hedge against inflation.

"There's not a huge amount of material recovery in physical demand for oil at this stage," said Toby Hassall, commodity analyst at CWA Global Markets Pty in Sydney. "We're seeing economies faced with a bit of a headwind when it comes to the withdrawal of stimulus packages. The U.S. dollar is playing a role in the weak oil price as well."

Crude oil for March delivery traded at $72.82 a barrel, down 7 cents, in electronic trading on the New York Mercantile Exchange at 11:03 a.m. Sydney time. The contract fell 75 cents, or 1 percent, to settle at $72.89 on Jan. 29, the lowest level since Dec. 21.

Oil dropped 8.2 percent in January, the first monthly decline since July and the biggest drop since December 2008. Commodities had the biggest monthly drop in 13 months on concern that demand may wane as governments seek to control economic growth. The Standard & Poor's GSCI Index of 24 raw materials including crude oil fell 7.3 percent in January.

The dollar was at $1.3872 per euro at 11:05 a.m. in Sydney from $1.3863 in New York on Jan. 29, after earlier touching $1.3853, the strongest level since July 8.

Brent crude oil for March settlement traded at $71.33 a barrel, down 13 cents, on the London-based ICE Futures Europe exchange at 10:50 a.m. Sydney time. The contract dropped 67 cents, or 0.9 percent, to $71.46 a barrel on Jan 29.

 

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