(For Bloomberg fair value curves, see CFVL <GO>)
Aug. 22 (Bloomberg) -- West Texas Intermediate crude rose from a two-week low as the fewest U.S. workers in more than five years applied for unemployment benefits over the past month, bolstering optimism that fuel demand will accelerate.
Prices gained as much as 1 percent as claims in the month ended Aug. 17 declined to 330,500 a week on average, the least since November 2007, the Labor Department reported. The index of U.S. leading indicators rose in July by the most in three months. Chinese manufacturing resumed expansion and output at European factories improved. WTI’s discount to Brent narrowed.
"You had positive economic data, which should imply greater demand," said Tom Finlon, the Jupiter, Florida-based director of Energy Analytics Group LLC. "The market should drift higher. It makes for a choppy ride, probably upward, in the near term."
WTI for October delivery rose 72 cents, or 0.7 percent, to $104.57 a barrel at 1:47 p.m. on the New York Mercantile Exchange. The volume of all futures traded was 25 percent below the 100-day average. The contract fell to $103.85 yesterday, the lowest close since Aug. 8.
Brent for October settlement slid 10 cents to $109.71 a barrel on the London-based ICE Futures Europe exchange. Volume was 26 percent below 100-day average. The European benchmark was at a premium of $5.14 to WTI. The spread was $5.96 yesterday, the widest since June 26.
Compared with a week earlier, jobless claims rose by 13,000 to 336,000, the Labor Department said. That’s in line with the median forecast of 48 economists surveyed by Bloomberg.
The Conference Board’s gauge of the economic outlook for the next three to six months increased 0.6 percent after no change the prior month.