May 11 (Bloomberg) -- Crude oil fell on speculation that last week’s 10 percent advance will be undone as U.S. inventories climb and fuel consumption declines.
Oil followed equity markets lower today, reversing gains made last week after the U.S. economy lost fewer jobs than expected. Crude inventories rose to the highest since 1990 in the week ended May 1 as fuel consumption tumbled, an Energy Department report showed on May 6.
“With stock markets down, it’s hard to argue that the economy is getting better,” said Peter Beutel, president of Cameron Hanover Inc., an energy consulting company in New Canaan, Connecticut. “Last week’s supply and demand numbers point to lower prices.”
Crude oil for June delivery fell 13 cents to settle at $58.50 a barrel at 2:49 p.m. on the New York Mercantile Exchange. The contract dropped as much as $1.85, or 3.2 percent, to $56.78 today. Prices are up 31 percent this year.
“It’s interesting that the oil market finished strongly while stocks remain lower,” said Nauman Barakat, senior vice president of energy at Macquarie Futures USA Inc. in New York. “The strong finish shows the resilience of this market.” more...
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