Crude Oil rose more than 2% this morning to trade above $73.50, the move has largely been fed by strengthening equity markets - on Wall Street both the Dow Jones and the S&P500 advanced more than half a percent, in Europe the FTSE 100 hit a 14 month high and the German Dax climbed 1.5%. The oil market also found some support from the weaker dollar.
On the New York Mercantile Exchange, the November Nymex Light Sweet Crude contract has gained more than one percent with the November futures trading at $73.50.
The US supply picture has dominated recent themes in the oil market. On the one hand, Crude inventories unexpectedly fell almost 1m barrels last week, however gasoline distillates rose three times more than anticipated.
On the face of it, many investors will still be left to ponder the ongoing US supply picture.
Investors who have been following the supply data will now assess the relative strength of the American consumption outlook. Against a backdrop of high unemployment and a weakening dollar, many commentators believe the outlook for the oil market remains clouded.
The week ahead sees the American Q3 reporting season step up a gear with several major corporation’s scheduled to release their interim results. The next few trading sessions may provide more clarity and decisiveness to an Oil market which has been stubbornly stuck in range for the past couple of months.
Major multinational companies such as JP Morgan (NYSE: JPEL), Goldman Sachs (NYSE: GSDO), General Electric (NYSE: GE) and Southwest Airlines (NYSE: LUV) all report this week. The new data and forthcoming projections will help Investors gauge the overall perception of America’s recovery and any resulting movement in equity markets will also provide stimulus to a range bound crude oil.
On Wall Street, Oil & Gas majors were generally subdued as the crude price weakened, Exxon Mobil (NYSE: XOM) and Chevron (NYSE: CVX) both rose over 1% each.
NYSE listed Murphy Oil Corp (NYSE:MUR) advanced almost 1½%, gaining $1.15 to trade at $62.57.
French Oil & Gas producer Total SA (NYSE:TOT) and Canadian based multinational operator EnCana (NYSE:ECA & TSX: ECA) both gained 2%. ConocoPhillips (NYSE:COP) rose 1.75% to trade at $51.65.