By Timothy Puko
U.S. oil prices rose slightly Thursday on tight supply and signs
of an improving economy.
Light, sweet crude for October delivery settled up 51 cents, or
0.6%, to $93.96 a barrel on the New York Mercantile Exchange. Brent
crude on ICE Futures Europe also rallied in the afternoon, shaking
off signals of weak international demand to settle up 34 cents, or
0.3%, to $102.62 a barrel.
A strong U.S. economy suggests that more people may drive,
burning gasoline and oil, and Thursday brought a string of strong
U.S. economic data. U.S. factory activity expanded at its fastest
rate in more than four years, sales of existing homes ticked higher
and claims for jobless benefits, a measure of layoffs,
declined.
Oil prices rose steadily throughout the day. After early-morning
trading brought Nymex oil near its lowest point since January, it
then rose as high as $94.45 a barrel in the afternoon. It
outperformed the Brent benchmark, a sign that the U.S. market was
focused on domestic data, said Carl Larry, analyst for Oil Outlooks
& Opinions.
"It's economic optimism here at its finest," Mr. Larry said.
The market also got a boost from strong spot buying, said Andy
Lebow, senior vice president for energy derivatives at Jefferies
Bache LLC. Refineries have been draining supply from the Cushing,
Okla., hub, and that hasn't stopped, he said.
The trend has led to two straight days of gains in an otherwise
dour market. Wednesday's weekly stockpile update from the U.S.
Energy Information Administration showed crude-oil stockpiles had
decreased last week by 4.5 million barrels, five times more than
expected.
"You're just seeing a continuation of the tight cash market,"
Mr. Lebow said. "The delivery point is very tight."
Front-month September reformulated gasoline blendstock, or RBOB,
rose 3.49 cents, or 1.3%, at $2.7475 a gallon.
September diesel rose 1.17 cents, or 0.4%, to $2.8375 a
barrel.
Write to Timothy Puko at timothy.puko@wsj.com
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