Crude oil traded little changed around $64 a barrel in New York before a report forecast to show that gasoline supplies expanded in the U.S.
Gasoline inventories in the world’s largest energy market probably rose by 850,000 barrels from 214.6 million barrels, a Bloomberg survey showed. That would be the sixth week of gains during what is typically peak time for demand. Stockpiles of crude likely fell for a 10th week out of 11, the survey showed.
“We haven’t yet seen the optimism materialize in increased consumption of oil,” said Thina Saltvedt , an analyst at Nordea Bank AB in Oslo. “Better than expected macro indicators are keeping hopes up, but we need to see some improvement in demand.”, Bloomberg reports.
Meanwhile, oil prices hovered near $64 a barrel Tuesday as investors weighed improving corporate results against weak crude demand.
By midday in Europe, benchmark crude for August delivery was up 18 cents to $64.16 a barrel in electronic trading on the New York Mercantile Exchange. On Monday, the contract rose 42 cents to settle at $63.98.
Traders have been cheered by stronger than expected second quarter company earnings, which suggest the U.S. economy is recovering from its worst recession in decades. Crude prices have jumped from $58.78 a barrel two weeks ago, The Associated Press reports.
“Market participants "are just selling and buying with no strong basis," said Masaki Suematsu, broker with Newedge Japan.
Crude was sold as the prices reached "nice levels, where traders are comfortable with closing longs to lock in profits," said Hiroyuki Kikukawa, analyst of Tokyo-based brokerage Nihon Unicom.
Although Asian stock markets began to rise again in the afternoon, traders didn't set up new long positions as they eyed weak fundamentals warily, he added, Wall Street Journal reports.