Crude gains marginally

Strong housing data improves sentiment

Crude oil prices ended higher at Nymex on Wednesday, 02 June 2010. Strong US economic data and higher US stocks helped dissipate demand concerns for the time being and pushed prices higher. The weekly inventory report by energy department is scheduled to be reported tomorrow, a day later, due to Memorial Day Holiday on last Monday.

On Wednesday, crude-oil futures for light sweet crude for July delivery closed at $72.86/barrel (higher by $0.28 or 0.4%). Last week, crude gained 5.6%.

For the month of May, crude shed 14%. It was the biggest monthly drop for crude since December 2008. For the month of April, crude rose 2.8%. For the first quarter of this year, crude rose by 5.5%. Year to date, crude is higher by 3.5%.

In the currency market on Wednesday, the dollar stayed relatively strong for almost the entire day but the dollar index ended the day with a 0.2% loss.

Among economic reports for the day, the National Association of Realtors reported that pending home sales index rose 6% in April after an upwardly revised 7.1% increase in March. The pending sales index is at the highest level since October, just before a previous tax credit expired. The index is up 22% compared with April 2009. Buyers rushed to sign sales contracts on previously owned homes in US in April before a tax subsidy expired. The report gave US equities a major boost today.

Among other energy products on Wednesday, gasoline for July delivery added 4 cents, or 2.2%, to $2.02 per gallon.

Natural gas for July delivery added 18 cents, or 4.1%, to settle at $4.42 per million British thermal units.

Crude ended FY 2009 higher by 78%, the highest yearly gain since 1999. It reached a high of $82 earlier in October 2009 and hit a low of $33.98 on 12 February 2009. Crude prices had ended FY 2008 lower by 54%, the largest yearly loss since trading began at Nymex.

At the MCX, crude oil for June delivery closed lower by Rs 31 (0.89%) at Rs 3,456/barrel. Natural gas for June delivery closed at Rs 206.6, higher by Rs 4.3 (2.1%).