US crude futures rise as ME ups supply concerns
Natural gas ends lower; gasoline stockpiles tick higher
US crude futures rose as concerns about threats to supply due to unrest in the Middle East offset ongoing demand worries. On the New York Mercantile Exchange, crude oil <CLc1> settled at USD88.94 a barrel, rising by USD0.66 for the week. In London, Brent crude <LCOc1>, settled at USD111.23, down by USD0.15. NYMEX RBOB gasoline <RBc1> settled at USD2.7640 a gallon, for the week, the contract rose by 0.20 cents. NYMEX heating oil <HOc1> closed up at USD3.0362. For the week, it was down by 0.40 cents. Energy/prec metals Close WTD% Y-T-D% Oil-WTI (Spot) 88.07 0.79% -10.89% Oil-Brent (Spot) 111.23 -0.13% 3.59% Gold (USD/t oz) 1,714.40 -2.17% 9..63% Silver (USD/t oz) 33.40 -2.05% 20.62% Global demand for crude is growing so strongly that the world needs “every single drop of Canadian oil,” the International Energy Agency’s chief economist Fatih Birol said, playing down fears that Canadian exports could be hit by growing US production. United States will still need to import crude as production from the Bakken and other domestic shale oil regions rises, and Canada is a big potential source of such supplies. In its annual forecast this month, the IEA said the United States could come close to being energy self-sufficient by 2035.
Qatar aims to raise the share of solar power in electricity generation to 16 percent by 2018, in a rare example of an OPEC nation embracing renewable energy. “We are working on a project to develop 1,800 megawatts of solar power,” said Fahad Bin Mohammed Al-Attiya, chairman of the organizers of talks in Doha from Nov. 26December 7 among almost 200 nations on slowing global warming. Currency Close WTD% Y-T-D% USD/EUR 1.2984 0.07% 0.30% USD/GBR 1.6010 --0.12% 3.06% JPY/USD 82.45 0.50% 7.16%
US crude stocks fell 347,000 barrels in the week to November 23, to 374.12mn barrels, after analysts polled by Reuters had forecast a build of about 300,000 barrels. US crude imports rose by 350,000 barrels per day (bpd) to 8.08mn bpd. Crude stocks at futures delivery hub Cushing, Oklahoma rose 707,000 barrels to 45.86mn barrels. Imports of refined products fell 242,000 bpd to 1.88mn bpd. US gasoline stockpiles rose a sharp 3.87mn barrels to 204.26mn barrels, compared with expectations for a smaller 900,0000 barrel build. Total US inventories of distillates, which include diesel and heating oil, fell 800,000 barrels to 112.04mn barrels, compared with forecasts for a smaller drawdown of about 200,000 barrels.
US natural gas futures ended lower pressured by milder late-month weather forecasts despite the recent run up in prices to 14-month highs. Front-month February natural gas futures on the New York Mercantile Exchange <NGc1> settled up at USD3.574 per million British thermal units (mmbtu). The EIA gas storage report showed total domestic gas inventories rose by 4 billion cubic feet (bcf) to 3.877 trillion cubic feet (tcf). Traders viewed the build as bearish, noting Reuters poll estimates called for a 12-bcf draw and the five-year average for that week was an 18-bcf decline. Storage in next week’s report is expected to drop below year-ago levels for the first time in 13 months, with early withdrawal estimates ranging from 50 bcf to 90 bcf.
The Euro rose to a more than onemonth high against the US Dollar after German lawmakers approved Greece’s latest rescue package. The Yen slid to the weakest in seven months versus the shared currency after data showed Japan’s consumer prices stagnated in October, adding to speculation the central bank will increase stimulus to spur inflation.
US economy grew faster than initially thought in the third quarter as restocking by businesses provided a big boost, but consumer and business spending were revised lower in a sobering reminder of the recovery’s underlying weakness. Gross domestic product expanded at a 2.7 percent annual rate, with export growth also helping to offset the weakest consumer spending and first drop in business investment in more than a year. Growth in consumer spending, which accounts for about 70 percent of US economic activity, was cut by more than half a percentage point. Index Close US-DJ Average 13,025.58 US-Nasdaq Com 3,010.24 US-S&P500 1,416.18
New US single-family home sales fell slightly in October and sales for the prior month were revised sharply lower, casting a faint shadow over one of the brighter spots in the US economy. The Commerce Department said sales dropped 0.3 percent last month to a 368,000-unit annual rate, while September’s sales pace was revised to 369,000 from 389,000.
US consumer confidence rose to a four-and-a-half-year high in November as consumers became more optimistic about the outlook for the economy, according to a private sector report released. The Conference Board said its index of consumer attitudes rose to 73.7 up from an upwardly revised 73.1 the month before, its highest since February 2008. Economists had expected a reading of 73.0, according to a Reuters pol.
US consumer spending WTD% 0.12% 1.46% 0.50% Y-T-D% 6.61% 15.55% 12.61%
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in October for the first time in five months and income growth stalled, leading some economists to cut already weak estimates of fourth-quarter economic growth. The Commerce Department said consumer spending fell 0.2 percent after a 0.8 percent increase in September. Income growth was flat as wages and salaries dropped 0.2 percent, in part because of work disruptions caused by the storm, which lashed the East Coast in late October.
The number of Americans filing new claims for unemployment benefits dropped for a second straight week last week, unwinding some of the stormrelated surge. Initial claims for state unemployment benefits dropped 23,000 to a seasonally adjusted 393,000, the Labor Department said. The prior week’s figure was revised up to show 6,000 more applications than previously reported.
Morale in the Euro-zone’s economy improved for the first time in almost a year in November, but signs of stagnant investment plans for next year in industry dampened hope of a quick recovery from recession. Economic sentiment in the Euro-zone rose 1.4 points to 85.7, ending an eight-month run of falls, the European Commission’s monthly business and consumer survey showed, beating forecasts. Index England-FTSE 100 Germany-DAX France-CAC 40
Euro-zone joblessness has reached a new high and the poor state of the economy is reducing inflation to near two-year lows. As the euro zone sinks into its second recession since 2009, the number of people out of work in the euro zone rose by 173,000 people in October to almost 19 million people unemployed. That pushed joblessness
Close 5,866.82 7,405.50 3,557.28 WTD% 0.82% 1.32% 0.81% Y-T-D% 5.29% 25.55% 12.58% to the highest level since the euro was introduced in 1999, at 11.7 percent of the working population, illustrating the human impact of a public debt and banking crisis that has reverberated across the world.
Euro-zone finance ministers and the International Monetary Fund clinched agreement on reducing Greece’s debt in a breakthrough to release urgently needed loans to keep the near-bankrupt economy afloat. Greece’s international lenders agreed on a package of measures to reduce Greek debt by EUR40bn, cutting it to 124 percent of gross domestic product by 2020. In a significant new pledge, ministers committed themselves to take further steps to lower Greece’s debt to “significantly below 110 percent” in 2022 — the most explicit recognition so far that some write-off of loans may be necessary from 2016, the point when Greece is forecast to reach a primary budget surplus. Greece will receive up to EUR43.7bn in stages as it fulfills the conditions. The December installment will comprise EUR23.8bn for banks and EUR10.6bn in budget assistance.
German inflation slowed by 0.1 percentage points to 1.9 percent YoY in November, according to preliminary data released, in line with expectations. On a monthly basis, German prices eased 0.1 percent, after holding steady in October. Monthly falls in the cost of petrol, heating oil and package holidays helped contribute to easing inflation, the statistics office said. Consumer prices harmonized to compare with other European Union countries showed a monthly fall of 0.1 percent and a YoY rise of 2.0 percent.
German unemployment rose for the eighth month running in October in seasonally adjusted terms but gained less than expected and remained close to a post-reunification low, data showed. Labor Office data showed the number of people out of a job rose by 5,000 to 2.939mn in November. The consensus forecast in a Reuters poll of 33 economists was for unemployment to rise by 15,000. The unemployment rate held steady at 6.9 percent.
German consumer morale dipped slightly going into December amid concerns over the Euro-zone crisis and global growth but still-solid domestic demand should help Europe’s largest economy avert recession, market research group GfK said. The forwardlooking consumer sentiment indicator, based on a survey of around 2,000 Germans, eased to 5.9 heading into December from a downwardly revised 6.1 in November, the same level as in October. December’s reading was below expectations in a Reuters poll of 24 economists for a level of 6.2.
Britain’s economy grew 1 percent in the third quarter as originally estimated, although that strength is unlikely to be sustained. Gross domestic product expanded by 1 percent on the quarter, in line with the Office for National Statistics’ initial estimate and economists’ forecasts. Consumer spending rose 0.6 percent on the quarter - the biggest increase in more than two years. The ONS said that was driven by spending on recreation and culture, including tickets for the London Olympics which took place during the three-month period. Total exports rose 1.7 percent on the quarter, while gross final expenditure less total imports dipped 0.4 percent.
British consumer confidence unexpectedly picked up to an 18-month high in November, according to a survey that offered finance minister George Osborne some relief before he sets out his plans to revive a stagnant economy next week . The GfK NOP headline index rose to -22 from -30 in October, the strongest since May 2011 and better than forecasts for an unchanged reading.
Japan’s jobless rate held steady in October and the availability of jobs declined, suggest recent improvements in the labor market have started to peak. The seasonally adjusted unemployment rate was 4.2 percent, unchanged from September and in line with economists’ median forecast, figures from the Internal Affairs ministry showed. The jobs-to-applicants ratio fell to 0.80 from 0.81 in September, matching the median forecast. It means there were 80 jobs available for every 100 job seekers. Index Close Japan-Nikkei 225 9,446.01 Japan-Topix 781.46
Japanese retail sales fell 1.2 percent in October from a year earlier, government data showed, adding to mounting evidence that the economy has fallen
Japan
WWTD% 0.85% 0.65% Y-T-D% 11.72% 7.25% into a mild recession. The fall compared with a median estimate for a 0.7 percent annual decline, according to a Reuters poll. Compared to the previous month, retail sales rose 0.7 percent, the data showed.
Japan’s industrial output unexpectedly rose 1.8 percent in October, up for the first time in four months. The rise compared with a median market forecast of a 2.2 percent drop, following a 4.1 percent decline in the previous month which was the biggest drop since the aftermath of last year’s earthquake.
Chinese Minister of Commerce Chen Deming said that China is poised for an annual gross domestic product (GDP) growth rate of 7.5 percent. Chen said China’s economy has advanced this year despite global economic headwinds, and full-year growth will be consistent with predictions made at the beginning of 2012. China will implement a more proactive openingup strategy in the face of grim world economic conditions, Chen said.
Profits earned by industrial companies leaped 20.5 percent in October over the previous year to CNY500bn, accelerating from September’s 7.8 percent YoY increase, China’s National Bureau of Statistics (NBS) said. It said China’s industrial enterprises made CNY4tn (USD647bn) in profits in the first 10 months of 2012, with earnings at power generation, technology and food processing companies seeing double digit rises in October - putting them firmly back on the path of profit growth, following a 1.8 percent fall in profits in the first nine months of 2012 versus 2011.
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India’s economy grew at a lowerthan-expected 5.3 percent in the quarter ending in September, against an analysts’ forecast of 5.4 percent. The manufacturing sector grew an annual 0.8 percent during the quarter whi le farm output rose 1.2 percent. In the quarter ending in June economic growth was at 5.5 percent.
India’s infrastructure sector output grew 6.5 percent in October from a year earlier, higher than a revised annual growth of 5 percent in the previous month. The infrastructure output for eight sectors - coal, crude oil, oil refinery, natural gas, steel, cement, electricity and fertilizers - grew at 3.7 percent in the April-October period from 4.3 percent a year earlier.