Crude registers mild gains

Crude rises riding on the back of steady economic reports

Crude prices ended modestly higher on Monday, 03 January, 2011 at Nymex. Prices were back above the $90 level since last week, the same level oil had last witnessed more than two years back. Prices rose riding on the back of steady economic reports.



On Monday, crude oil futures for light sweet crude for January delivery closed higher by $0.17 (0.2%) at $91.55/barrel. Earlier in the day, it rose to a high of $92.66.

Crude ended December higher by 8.6%. Crude ended the fourth quarter higher by 13%. For the third quarter, crude ended higher by 5.7%. Crude had ended second quarter of CY 2010 lower by 9.3%. For the first quarter of this year, crude rose by 5.5%. For the year of 2010, crude closed higher by 15%.

The Institute for Supply Management reported on Monday, 03 January 2011 that its index of factory activity rose to 57.0% in December from 56.6% the prior month — the highest level since last May. Readings over 50% indicate that more firms are growing than contracting. Market was expecting the figure to be 57.5.

Among other data, The Commerce Department in US reported on Monday, 03 January 2011 that outlays for U.S. construction projects rose for the third straight month in November. Construction spending rose 0.4%, slightly higher than economists' expectations of about a 0.2% gain. Spending on public-sector and private projects increased in November. Outlays are still down 6% compared with a year earlier.

In the currency market on Monday, the dollar advanced against several key currencies, namely the yen, euro, and pound. Strength in the greenback helped the dollar index climb as much as 0.7% before that gain was dashed. Still, the dollar managed to fend off efforts to take it into the red; it was up about 0.3% as of the close of trade.

Gasoline futures ended marginally lower at $2.4273 after it ended 2010 with a 19% yearly rise.

Heating oil for February ended up 1 cent, or 0.4%, to $2.55 a gallon. The most active contract ended up 21% last year.

Natural gas for February delivery surged 25 cents, or 5.6%, to $4.65 per million British thermal units, after losing 21% last year. It was the biggest one-day gain for natural gas since October.

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 January closed higher by Rs 49 (1.2%) at Rs 4,136/barrel. Natural gas for January delivery closed at Rs 208.3, higher by Rs 9.5 (4.8%).