OIL FUTURES: Crude Falls On Weak China Data, Equities Drop
14 April 2012 - 5:40AM
Dow Jones News
Crude oil futures declined Friday along with U.S. stock markets
after disappointing data out of China increased worries about the
economy of the world's largest energy consumer.
Light, sweet crude for May delivery settled 81 cents, or 0.8%,
lower at $102.83 a barrel on the New York Mercantile Exchange.
Brent crude on the ICE futures exchange rose 10 cents to $121.81 a
barrel.
China's economic growth fell to 8.1% last quarter, the lowest
since 2009 and below economists' forecast of 8.3%. Leaders of the
country, which is a major buyer of oil and other commodities, are
trying to slow growth to a more sustainable level without causing a
bigger economic slide that could spark fears about the global
economy.
The data pushed down equities markets along with oil prices as
investors considered whether demand for fuel products would be hurt
by the China slowdown.
"This shows how jittery the market is. We've had quite a rally
in risk assets, and people are standing really close to the door,"
said Sean McGillivray, vice president and broker at Great Pacific
Wealth Management.
Dow Jones Industrial Average was recently down 0.5% at
12,917.
Crude futures have held in a tight range just above $100 a
barrel for weeks. But despite signs of slowing fuel demand growth,
worries about a supply shortage due to tensions between Iran and
the West have kept prices from dipping lower.
On Thursday, the International Energy Agency said production
from members of the Organization of Petroleum Exporting Countries
outpaced demand during the first quarter. Oil stockpiles rose by as
much as 1.2 million barrels a day during the first three months of
the year, the IEA said, breaking "the cycle of repeatedly
tightening fundamentals evident since 2009."
The IEA represents the world's developed energy-consuming
nations.
Iran is set to meet with six world powers Saturday in Istanbul
for talks focused on the country's nuclear program. A breakthrough
in the talks could help reduce fears of a military conflict arising
in the Persian Gulf region, which would likely lower oil prices.
But investors remain wary of betting on declines until discussions
begin.
Industry sources say the meeting will set the tone for oil
markets in the coming weeks.
"The range is here. I don't expect the market to press any lower
with the negotiations going on," said Rich Ilczyszyn, a broker at
iiTrader in Chicago.
Front-month May reformulated gasoline blendstock, or RBOB,
settled 1.06 cents, or 0.3%, lower at $3.3461 a gallon. May heating
oil settled 0.83 cent higher at $3.1746 a gallon.
More information on settlements and highs and lows for futures
on Nymex and ICE platforms can be found by searching for the
following headlines:
Nymex Light Crude Oil Close
Nymex Harbor RBOB Gasoline Close
Nymex Heating Oil Close
ICE Brent Crude Oil Close
ICE Gas Oil Close
-By Jerry A. DiColo, Dow Jones Newswires; 212-416-2155;
jerry.dicolo@dowjones.com