Oil prices rise ahead of key European bank meeting
The oil market found little to motivate it Wednesday. That should change in the next two days.
Benchmark oil rose 6 cents to end at $95.36 per barrel in New York. Weak manufacturing reports earlier in the week from China and the U.S., as well as Europe's dire economic picture, weighed on trader sentiment. But that was countered by hope for measures from central banks and governments to promote global economic growth. Such steps could translate into more demand for energy products.
Two upcoming developments provide a better sense of what's ahead for the global economy. And what direction oil prices will head.
The European Central Bank is expected to announce a bond-buying program Thursday to reduce high borrowing costs in Spain and Italy. The program is designed to help stabilize the region's financial crisis and promote growth.
If the ECB falls short of expectations, that would heighten concerns about a regional recession and lower oil prices, said oil analyst Gene McGillian of Tradition Energy.
He speculated that the price could drop into the mid-$80 per barrel range. Oil's low for the year was $77.69 per barrel in late June.
On Friday, the U.S. government comes out with its latest jobs report. Oil could rise with another positive report. On Aug. 3 the government reported the best monthly job growth since early in the year, and the price of oil rose 5 percent.
Meanwhile, average gas prices were unchanged overnight at $3.824 per gallon, according to AAA, Wright Express and the Oil Price Information Service.
Brent crude, which is used to price international varieties of oil, fell $1.09 to $113.09 per barrel in London.
In other futures trading in New York:
— Heating oil fell 2.92 cents to end at $3.1176 per gallon.
— Wholesale gasoline fell 0.24 cent to end at $2.9498 per gallon.
— Natural gas fell 5.9 cents to end at $2.795 per 1,000 cubic feet.