Crude nears $79 mark

Prices pare earlier losses in tandem with US equities

Crude oil prices managed to pare their earlier losses on Friday, 30 July 010 at Nymex and ended higher for the day. Prices rose in tandem with US equities which managed to shed most of their earlier losses in the course of the day
and finish near the unchanged mark at the end.



On Friday, crude oil futures for light sweet crude for September delivery closed at $78.95/barrel (higher by $0.59 or 0.8%). For the week, crude ended marginally higher.

For the month of July, crude ended higher by 4.5%. Before this, in June, oil prices shed 2.7%. Crude ended second quarter of CY 2010 lower by 9.3%. For the first quarter of this year, crude rose by 5.5%. Year to date, crude is higher by 0.5%.

The Commerce Department in US reported on Friday that U.S. economy expanded at an annualized rate of 2.4% in the second quarter, but that was a bit below the 2.5% that had been widely expected and down from the first quarter's upwardly revised 3.7% growth rate. It was also well below the average 4.4% increase over the past six months. Additionally, personal consumption for the second quarter increased 1.6% after a 1.9% increase in the first quarter.

Disappointing GDP data had stocks down more than 1% in the early going, but for the second straight session they fought their way higher only to struggle near the neutral line.

Earlier during the week, EIA reported an increase of 7.3 million barrels of crude stockpiles for the week ended 23 July against an expected increase of 2.3 million barrels. The EIA also reported an increase of 100,000 barrels for stockpiles of gasoline and 900,000 barrels for distillates. Market had predicted weekly increases of 1.1 million barrels for gasoline and 1.8 million barrels for distillates.

Among other energy products on Friday, reformulated gasoline for September delivery added 2 cents, or 1%, to settle at $2.12 a gallon. Gasoline prices rose 3% in July.

Also, on Friday, natural gas for September delivery added 10 cents, or 2%, to settle at $4.92 per million British thermal units. Natural-gas futures had a winning July, hitting a 6.5% gain for the month.

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.