Crude-oil futures settled higher Thursday, pulling out a win after a seesaw session during which traders weighed positive economic reports against data showing a sharp increase in the past week’s supplies.
Crude for December delivery rose 32 cents, or 0.4%, to $86.05 a barrel on the New York Mercantile Exchange. The contract had swung as high as $86.75 a barrel and as low as $85.23.
“I think the market is generally in a ‘wait and see’ mode,” said Neal Ryan, managing partner at Ryan Oil & Gas Partners LLC. “U.S. elections are nearly past us and there is the belief that there could be a major shift in policy if the Romney ticket wins, boding very well for the domestic energy sector.”
Ryan also noted the market has seemingly hit a “pause button” as it watches the so-called fiscal cliff situation in Washington. Oil looks like it’s in an “$85-$95 price box until something shakes loose,” such as flare-up in geopolitical tensions.
Platts on Thursday offered a look at demand from China, the world’s second-largest economy. Apparent oil demand rose 9.1% in September compared with a year ago to an average 9.8 million barrels per day — the highest on record, according to a Platts analysis of recent Chinese government data.
Oil prices had been buoyed early Thursday by U.S. economic data: Orders for durable goods surged 9.9% in September, exceeding expectations, and first-time jobless claims dropped by 23,000 to a seasonally adjusted 369,000 last week.
The U.K. also received good economic news Thursday, with data showing a resumption in growth for gross domestic product in the third quarter.
“The U.K. economy has shown the strongest expansion in five years … while notoriously volatile [U.S.] durable goods have come volatile but decent overall,” said Matt Smith, commodity analyst at Schneider Electric, in a report.
“U.S. weekly jobless claims were in line with expectations, while bad-is-good news comes from Japan and the consideration of an increase to their asset-buying plan,” he said. So “crude is seeing a bounce.”
However, the dollar held firm, weighing on dollar-denominated commodities. The dollar index, a benchmark used to track the greenback against a basket of other major currencies, rose to 80.052 from 79.932 late Wednesday.
Dollar strength weighs on dollar-denominated commodities such as oil because it makes them more expensive for holders of other currencies.
In other energy trading Thursday, November heating oil tacked on 2 cents, or 0.8%, to $3.06 a gallon. At the same time, November gasoline climbed 7 cents, or 2.8%, to $2.68 a gallon, marking the first finish higher in 11 sessions.
However, natural-gas futures pulled back after the Energy Information Administration reported inventories of the commodity rose by 67 billion cubic feet for the week ended Oct. 19. Analysts polled by Platts expected a buildiup of between 63 billion cubic feet and 67 billion cubic feet.
Total supplies of gas in storage now stand at 3.84 trillion cubic feet, up 153 billion cubic feet from the year-ago level and 251 billion cubic feet above the five-year average, the government said.
“There’s no shock value in today’s report,” said Tim Evans, energy futures specialist at Citi Futures, in a report. “With no surprise here, the tussle in the futures market will remain over what the appropriate valuation should be, given ample storage.”
November natural gas gave up 2 cents, or 0.5%, to $3.43 per million British thermal units.