Oil lower after housing data; pump prices steady
NEW YORK (AP) — Oil fell Monday after the U.S. government said sales of previously occupied homes dipped in June.
Meanwhile the average price of gasoline in the U.S. stayed at $3.67 a gallon over the weekend after rising steadily for two weeks.
Benchmark crude oil dropped $1.14 to finish at $106.91 a barrel on the New York Mercantile Exchange.
Sales of previously occupied homes in the U.S. slipped 1.2 percent in June to a seasonally adjusted annual rate of 5.08 million. Any sign that the U.S. economic recovery is slowing can depress oil prices.
Oil is still up more than $13 a barrel since June 21, underpinned by sharp declines in U.S. stockpiles and concerns of supply disruptions in the Middle East.
Some analysts, however, say the fundamental rules of supply and demand alone do not justify the rise and speculators are also pushing the price higher.
"While crude oil stocks have declined for three weeks in a row, fundamentals in the gasoline and distillates markets appear less supportive," said a report from JBC Energy in Vienna. "Stock levels for oil products are in line or above the 5-year average, and domestic demand is anything but impressive."
Energy analysts at The Schork Group Inc. said open interest, which is the number of open futures contracts, is at record levels as is participation of Wall Street hedge funds and investors such as commodity pool operators. They said in a report that Wall Street now owns six times as many barrels of oil in the WTI futures market as there are sitting at the Nymex oil delivery terminal in Cushing, Oklahoma.
Brent crude, which is traded on the ICE Futures exchange in London, rose 8 cents to end at $108.15 a barrel.
Oil's rise has meant more expensive gasoline across the U.S. Since July 1 the average price for a gallon has risen 25 cents in Delaware and New Jersey, 26 cents in Ohio and 32 cents in Indiana. Prices have declined in just three states: Colorado, Idaho and Utah.
In other energy futures trading on the Nymex:
— Wholesale gasoline lost 7 cents to finish at $3.06 a gallon.
— Heating oil gave up 2 cents to end at $3.07 a gallon.
— Natural gas retreated by 11 cents to finish at $3.68 per 1,000 cubic feet.
AP Writer Pablo Gorondi in Budapest contributed to this report.