MELBOURNE: Oil traded near the highest level in more than a week in New York after Federal Reserve policy makers said they expect growth to accelerate, boosting speculation that fuel demand will rise.
Futures were little changed after gaining 0.6% yesterday. “Economic growth is expected to remain moderate over coming quarters and then to pick up gradually,” the Federal Open Market Committee said in a statement. Prices declined earlier as U.S. supplies gained and Iran’s envoy in Moscow said his country is considering a proposal to halt the expansion of its nuclear program.
Crude for June delivery was at US$104.05 a barrel, down 7 cents, in electronic trading on the New York Mercantile Exchange at 9:46 a.m. Sydney time. The contract yesterday rose 57 cents to US$104.12, the highest close since April 17. Prices are 5.3% higher this year.
Brent oil for June settlement increased 0.8% to US$119.12 a barrel on the London-based ICE Futures Europe exchange yesterday. The European benchmark contract’s front month premium to West Texas Intermediate closed at US$15.
Iran is considering a Russian proposal to halt the expansion of its nuclear program in order to avert new sanctions, Iranian Ambassador Mahmoud-Reza Sajjadi said in Moscow yesterday. Oil prices have climbed this year amid speculation that tension with Iran may disrupt global supplies.
U.S. crude inventories rose 3.98 million barrels to 373 million last week as output climbed to a 12-year high, according to the Energy Department. Stockpiles were projected to increase 2.8 million barrels, according to the median of 11 analyst estimates in a Bloomberg survey. (Bloomberg/T07/aph)