Oil traded near a two-day low in New York as speculation Europe will struggle to contain its debt crisis countered signs of declining fuel stockpiles in the U.S., the world’s largest crude consumer. Brent futures rose.
West Texas Intermediate oil was little changed after falling 0.9 percent yesterday as Italy’s borrowing costs climbed to the highest level since June 1997 at an auction, deepening concern that Europe’s crisis is worsening. U.S. crude and fuel inventories probably shrank for a second week, according to a Bloomberg News survey before an Energy Department report tomorrow. Hedge funds raised bullish bets on oil the most since May, a Commodity Futures Trading Commission report showed.
“There is still a lot of uncertainty over Europe,” saidKen Hasegawa, a commodity-derivatives trading manager at Newedge Group in Tokyo who says futures will trade between $95 and $100 a barrel this week. “Last night’s decline was a correction but the downside will be limited from a technical point of view.”
Crude for December delivery was at $98.08 a barrel, down 6 cents, in electronic trading on the New York Mercantile Exchangeat 4:23 p.m. Singapore time.
Brent for December settlement, which expires today, was up 99 cents, or 0.9 percent, at $112.88 a barrel on the ICE Futures Europe exchange. The more actively traded January contract climbed 77 cents to $112.05.