LONDON: Brent crude oil futures fell towards $102.50 a barrel yesterday as the dollar gained following better-than-expected US consumer data, which could strengthen the case for the US Federal Reserve to reduce stimulus.
Fed governors earlier said the bank was in no rush to curtail its bond-buying programme, but investors have been interpreting positive data as signs the Fed policy could shift sooner rather than later.
The North Sea benchmark, however, was still on track for its third quarterly loss, the longest losing streak since 1997/98, on persistent worries about the state of the global economy and its impact on oil demand.
Brent crude oil futures were down 15 cents at $102.69 a barrel by 1415 GMT, after earlier hitting a session high of $103.44.
US crude oil fell 11 cents to $96.95 a barrel.
Comments by Fed governors on Friday appeared to allay investors’ concerns the policy change would derail growth and dampen oil demand in the world’s top oil consumer. “Non-farm payrolls next Friday will set the tone on whether QE3 (US quantitative easing) will ease”, anytime soon, Olivier Jakob, an analyst at consultancy Petromatrix in Switzerland, said.
The premium of Brent over US oil futures was at $5.74 a barrel after narrowing earlier in the day to $5.50, its tightest since January 2011. “Recent flooding in Canada had boosted WTI against Brent,” Robert Montefusco, an analyst at Sucden Financial brokerage in London said.
Reuters
