(1888PressRelease)
May 01, 2009 - Oil rose above $51 a barrel Thursday in Asia as investors took heart from optimistic comments from the U.S. Federal Reserve that the worst recession in decades is likely easing.
Benchmark crude for June delivery was up 52 cents to $51.49 a barrel by midday in Singapore, in electronic trading on the New York Mercantile Exchange. The contract Wednesday gained $1.05 to settle at $50.97.
Investors have brushed off recent dismal news -- such as an annualized 6.1 percent contraction of U.S. gross domestic product in the first quarter, and pointed to so-called green shoots, positive signs that the economy may be turning around.
Federal Reserve policymakers said at the end of a two-day meeting Wednesday that while the economy is still receding, the pace of decline "appears to be somewhat slower" than the last time they met in mid-March.
Investors, cheered by signs that U.S. consumer spending is growing, sent the Dow Jones industrial average up 2.1 percent Wednesday.
"Investors are looking ahead and betting that the worst economic declines are over," said Stephen yang, an analyst with Seedorf Luxman & Partners in Singapore "In the past few weeks, investors have pretty much ignored any bad news," he said.
This month prices have crisscrossed $50 a barrel as surging crude inventories tempered renewed optimism about the economy.
The Energy Information Administration reported Wednesday that oil inventories jumped by 4.1 million barrels for the week ended April 24, more than twice what was expected by analysts, according to a survey by Platts, the energy information arm of McGraw-Hill Cos.
U.S. stores of crude have reached levels not seen since Aug. 31, 1990. Government data also show that petroleum consumption is down to 18.4 million barrels a day, the lowest since May 28, 1999.
"Inventories are very high and ought to be a concern," Shum said. "The fundamentals really limit any potential gains in oil," the Seedorf Luxman & Partners analyst said.
In other Nymex trading, gasoline for May delivery was steady at $1.44 a gallon and heating oil was steady at $1.33 a gallon. Natural gas for June delivery fell 5.5 cents to $3.35 per 1,000 cubic feet.
In London, Brent prices fell 39 cents to $49.60 a barrel on the ICE Futures exchange.
Seedoorf Luxman & Partners are a specialized advisory and consultancy company that provides investors with the resources necessary to find small stocks with tremendous growth potential, unknown to the general investing public. All of our team with comprehensive fields of expertise are driven by a focus upon helping our clients meet their investment objectives. Whether you are an individual investor or an institutional client we will provide an excellent level of service.
###
