NEW YORK: Crude oil prices shot higher Friday, propelled by news the US economy shrank less than expected in the second quarter, offering more hope for an economic rebound. A sharp decline in the dollar also helped support the oil rally. New York's main contract, light sweet crude for September, jumped 2.51 dollars to close at 69.45 dollars a barrel. In London, Brent North Sea crude for September delivery gained 1.59 dollars to settle at 71.70 dollars a barrel. The New York session was volatile, with the barrel swinging in a range of nearly five dollars. Traders' initial reaction to the US gross domestic product (GDP) data was negative. The Commerce Department reported that the world's largest economy and biggest consumer of energy shrank at an annualized rate of 1.0 percent in the second quarter. That was less than the 1.5 percent contraction that most analysts had expected, but the data showed a 6.4 percent decline in the first quarter, worse than the previous estimate of a 5.5 percent drop. But the market chose to look on the bright side of the mixed report, help by the Chicago purchasing managers index that showed a slowing in the decline of industrial activity in the region. The indicator came in better than anticipated "so the dollar got wrecked," said Phil Flynn of PFG Best Research. Link..
Oil prices shoot up after US GDP data
NEW YORK: Crude oil prices shot higher Friday, propelled by news the US economy shrank less than expected in the second quarter, offering more hope for an economic rebound. A sharp decline in the dollar also helped support the oil rally. New York's main contract, light sweet crude for September, jumped 2.51 dollars to close at 69.45 dollars a barrel. In London, Brent North Sea crude for September delivery gained 1.59 dollars to settle at 71.70 dollars a barrel. The New York session was volatile, with the barrel swinging in a range of nearly five dollars. Traders' initial reaction to the US gross domestic product (GDP) data was negative. The Commerce Department reported that the world's largest economy and biggest consumer of energy shrank at an annualized rate of 1.0 percent in the second quarter. That was less than the 1.5 percent contraction that most analysts had expected, but the data showed a 6.4 percent decline in the first quarter, worse than the previous estimate of a 5.5 percent drop. But the market chose to look on the bright side of the mixed report, help by the Chicago purchasing managers index that showed a slowing in the decline of industrial activity in the region. The indicator came in better than anticipated "so the dollar got wrecked," said Phil Flynn of PFG Best Research. Link..
