CRUDE OIL rose above $145 a barrel to another record amid signs global demand for fuels, particularly from China, may strain supplies.
PetroChina may import record volumes of petroleum products this year to meet demand needed for reconstruction after an earthquake, China National Petroleum Corp said last week, and to prepare for the Olympics.
Heating oil futures, a proxy for distillate fuels including diesel, rose to a record yesterday.
“There’s a kind of expectation in the market that there will be strong ongoing demand for distillate fuel,” said Tim Evans, an energy analyst for Citi Futures Perspective in New York.
Crude oil for August delivery rose $1.73, or 1.2 per cent, to $145.30 a barrel at the 2.30pm close of floor trading on the New York Mercantile Exchange.
Futures earlier touched $145.85, the highest since trading began in 1983.
Concern that economic growth may be slowing dampened crude oil’s gain. US employers cut jobs for a sixth consecutive month and service industries shrank in June, signalling that the slowdown may deepen as the impact of federal tax rebates fades.
The euro fell the most against the dollar in more than three weeks after European Central Bank president Jean-Claude Trichet indicated he may not boost interest rates again after raising rates by a quarter-point to 4.25 per cent yesterday.
The euro dropped 1.2 per cent to $1.5697 at 2.43pm in New York, from $1.5882 yesterday. Declines in the dollar were one of the factors responsible for a 48 per cent increase in oil futures prices in the first half of the year.
Earlier, oil reached a record amid buying from investors seeking an alternative to tumbling stock markets and amid concern a conflict with Iran over its nuclear programme would cut Persian Gulf supplies.
Brent crude oil for August settlement rose $1.84, or 1.3 per cent, to $146.10 a barrel on London’s ICE Futures Europe exchange.
Futures earlier climbed to $146.69, the highest intraday price since trading began in 1988. – (Bloomberg)
