Crude ends mildly lower

Credit rating downgrade on Spain renewed concerns over oil demand Crude prices ended mildly lower on Tuesday, 29 May 2012 at Nymex. Prices dropped for first time in three sessions as credit rating downgrade on Spain renewed concerns over oil demand from the euro zone and buoyed the U.S. dollar. Weaker than expected consumer confidence data at Wall Street also affected prices. Light and sweet crude for July delivery fell $0.10 (0.1%) to $90.76 a barrel on the New York Mercantile Exchange on Tuesday. In the currency market on Tuesday, the U.S. dollar index, which weighs the strength of the dollar against a basket of six currencies rose by 0.4%. The market place was tentative early Tuesday, following a long U.S. holiday weekend, and got more uneasy on the Eagan Jones credit downgrade for Spain. The Euro currency fell to a fresh nearly two-year low on the ratings downgrade news. The latest European Union debt and financial crisis developments also saw the large Spanish bank, Bankia, given significant bailout money over the weekend. There were also reports overnight that China is set to introduce fresh monetary stimulus measures to boost its economy. Such steps would be raw commodity market-bullish. Latest economic report at Wall Street showed that a gauge of U.S. consumer confidence declined for a third month, with gloomier views in May on present and future conditions. The Conference Board reported on Tuesday that the consumer-confidence index fell to 64.9 in May, the lowest level since January from a revised 68.7 in April. A prior estimate for April pegged the level at 69.2. Market had expected a reading of 70 for May. Traders and investors will continue to closely monitor U.S., EU and Chinese economic data for early clues on monetary policy actions from the central bank. Among other traded energy products on Tuesday, gasoline bucked the trend but pared earlier gains, with June gasoline adding 1 cent, or 0.5%, to $2.91 a gallon. June heating oil followed oil lower, losing 2 cents, or 0.7%, to end at $2.81 a gallon. Natural gas for June delivery closed at $2.43 per million British thermal units, down 14 cents, or 5.4%. At the MCX, crude oil for June delivery closed higher by Rs 26 (0.5%) at Rs 5,097/barrel. Natural gas for June delivery closed higher by Rs 1.9 (1.3%) at Rs 144.2.