SINGAPORE: Oil prices hovered below US$79 a barrel Tuesday in Asia as investors mulled mixed signals about the strength of the U.S. economy.
Benchmark crude for April delivery was down 2 cents to $78.68 a barrel at midday Singapore time in electronic trading on the New York Mercantile Exchange.
The contract Monday fell 96 cents to settle at $78.70.
Oil prices have been drifting between $70 a barrel and $80 for most of the last eight months as crude demand remains weak in developed countries despite economies expanding again in the aftermath of last year’s recession.
On Monday, U.S. economic figures reflected a slow but steady recovery.
Manufacturing output expanded in February for a seventh straight month, but it slowed compared with January and fell short of expectations.
Personal spending rose slightly more than expected in January while construction spending fell for a third straight month.
Investors will be eyeing weekly U.S. crude inventory data and February jobs numbers later this week for a possible catalyst for oil prices.
In other Nymex trading in April contracts, heating oil rose 0.1 cent to $2.024 a gallon, and gasoline gained 0.44 cent to $2.16 a gallon.
Natural gas rose 0.5 cent to $4.684 per 1,000 cubic feet.
In London, Brent crude was up 1 cent at $76.90 on the ICE futures exchange.
Oil price falls as US$ strengthens
NEW YORK: Crude oil futures gave back earlier gains Monday and slid on a rising dollar and a manufacturing report that fell short of economists’ expectations.
Oil prices got to $80.62 a barrel on the New York Mercantile Exchange before falling back to settle at $78.70, down 96 cents.
On Friday, the contract added $1.49 to settle at $79.66. The $80 level has been tough for oil to crack.
U.S. manufacturing output expanded in February for a seventh straight month, as factory output has provided one of the few areas of strength for the economy.
Still, the growth in manufacturing activity slowed compared with January.
The Institute for Supply Management, a trade group of purchasing executives, said its manufacturing index read 56.5 last month.
That was slower than the 58.4 reading in January. A reading above 50 indicates expansion.
A stronger dollar also was a drag on oil Monday.
Oil is traded in dollars on global markets and becomes more expensive for international investors who hold other currencies.
The dollar jumped to a 9-month high against the pound and extended its rise against the euro as worries about Greece’s financial stability, a possible European bailout plan and uncertainty about U.K. government and debt sent investors to the U.S. currency’s safety.
In trading in New York, the British pound tumbled below $1.50 for the first time since May 2009.
The 16-nation euro dropped to $1.3574 from 1.3620 late Friday.
This week, investors will be eyeing U.S. jobs data to get a better sense of the recovery in the world’s largest economy.
The Labor Department is scheduled to announce February’s unemployment rate on Friday. Joblessness was 9.7 percent in January.
Oil prices have touched the low $80 level several times in the last six months, but fallen back into the $70s when U.S. crude inventory data failed to justify investor optimism.
In other Nymex trading in April contracts, heating oil fell 1.18 cents to settle at $2.0235 a gallon, and gasoline lost 3.23 cents to settle at $2.1556 a gallon.
Natural gas lost 13.4 cents to settle at $4.679 per 1,000 cubic feet.
In London, Brent crude dropped 70 cents to settle at $76.89 on the ICE futures exchange.