Crude oil reverses early losses on China data

28 July 2010

Written by Neil Brunskill

Crude oil prices reversed early losses during the electronic trading session of the New York Mercantile Exchange this morning (July 28th) after positive economic data from China.

Gains in Chinese equities helped to support the commodity, while underlying consumer spending and tourism figures increased expectations of growth in fuel demand in the world's fastest-growing economy.

The demand outlook in the US had put pressure on crude and heating oil early in the session after a report from the American Petroleum Institute suggested an unexpectedly large increase in fuel inventories last week.

Analysts polled by Bloomberg and Reuters anticipated that the report would show an increase of one million barrels of crude last week, but crude prices slumped after the figure came in at 3.1 million barrels last week.

By 02:53 Central Standard Time, the commodity was trading at $77.46 a barrel, four cents off yesterday's settle price.

Heating oil prices were also relatively flat, registering fractional gains around $2.00 a gallon.