Oil trims biggest monthly decline
Oil rebounded, trimming the biggest monthly decline since May, as refineries started resuming operations after the Atlantic superstorm Sandy moved away from the US. East Coast.
Crude futures gained as much as 1.1 percent after advancing 0.2 percent yesterday. Philadelphia Energy Solutions' 355,000 barrel-aday Pennsylvania refinery is restoring operations and NuStar Energy LP (NS)'s 74,000 barrel-a-day plant in Paulsboro, New Jersey, will be at full production tomorrow, the companies said. Seven refineries with a total capacity of 1.29 million barrels a day had shut or reduced operations because of Sandy.
"The hurricane is gone, and we now have to investigate how much of an impact it had on the refineries," said Tetsu Emori, a chief fund manager at Astmax Investment Management Inc. in Tokyo. "People in the market are unwilling to take fresh positions at the moment, but they are also not willing to sell because oil is currently quite cheap and oversold."
Crude for December delivery rose as much as 91 cents to $86.59 a barrel in electronic trading on the New York Mercantile Exchange, and was at $86.45 at 8:43 a.m. London time. Prices gained 14 cents yesterday to $85.68, the highest close since Oct. 26. Futures are down 6.2 percent in October and 12.5 percent this year.
Brent for December settlement rose 49 cents to $109.57 a barrel on the London-based ICE Futures Europe exchange. The European benchmark crude's premium to the West Texas Intermediate contract was at $23.10, down from $23.40 yesterday.
Oil may extend gains in New York after futures settled above the lower Bollinger Band yesterday for the third time in four days, signaling technical support, according to data compiled by Bloomberg. This indicator is at $85.02 a barrel today. Buy orders tend to be clustered near chart-support levels.
Gasoline for November delivery rose as much as 9.78 cents to $2.8266 a gallon in New York, the highest level since Oct. 17. The contract expires today. The more-active December future was up 3.04 cents at $2.6459.