Oil prices rose this afternoon as investors awaited the results of the Federal Reserve’s policy meeting. Comments from Fed chairman Ben Bernanke, who will hold a press conference after the interest rate announcement, will be closely watched for indications whether additional stimulus is on the cards.
It has been speculated that the Fed may consider launching a third round of quantitative easing (QE3) after the March non-farm payrolls report showed that the US economy created only 120,000 jobs last month.
More disappointing economic data was released today with the Commerce Department reporting that orders for goods that are not expected to wear out within three years dipped 4.2 in March, posting the biggest monthly loss in three years.
Oil prices also received support from an early rally in US stock markets, which came after Apple and Boeing reported better than expected quarterly results.
Gains in oil futures were curbed by disappointing US inventories data and a Bloomberg report, which said that Iran’s envoy in Moscow said that the Middle Eastern country is considering stopping the expansion of its nuclear programme to avert further sanctions.
Meanwhile, the Department of Energy said this afternoon that crude oil stocks in the US added a massive four million barrels last week with total inventories reaching 373 million barrels.
US light, sweet crude for June, currently the most actively trade contract on the New York Mercantile Exchange (NYMEX), rose 28 cents to US$103.83/barrel in morning trade in New York.
June Brent crude rose 14 cents to US$118.30/barrel on the ICE Exchange this afternoon.
Today’s top risers in the oil and gas sector were:
Forum Energy (LON:FEP), up 109 percent at 201.85 pence at midday
Falkland Oil & Gas (LON:FOGL), up 7 percent at 87.75 pence
Serica Energy (LON:SQZ), up 5 percent at 31 pence
Kea Petroleum (LON:KEA), up 4.5 percent at 8.9 pence
Desire Petroleum (LON:DES), up 4.5 percent at 28.27 pence
The top fallers were:
Matra Petroleum (LON:MTA), down 11.5 percent at 2.41 pence at midday
Afren (LON:AFR), down 6 percent at 134.5 pence
Madagascar Oil (LON:MOIL), down 5 percent at 24.94 pence
Sefton Resources (LON:SER), down 4.5 percent at 2.2 pence
Petro Matad (LON:MATD), down 4 percent at 21.6 pence