SINGAPORE (AP) - Oil prices held above $70 a barrel Friday in
Asia as investors mulled mixed signs about the strength of the U.S.
economy and crude demand.
Benchmark crude for August delivery added 39 cents to $70.62 a
barrel by midday Singapore time in electronic trading on the New
York Mercantile Exchange. On Thursday, it gained $1.56 to settle at
Investors were cheered Thursday by better than expected earnings
reports from homebuilder Lennar Corp. and home furnisher Bed Bath &
Beyond Inc. The Dow Jones industrial average jumped 2.1 percent,
and most stock indexes in Asia rose in early trading Friday.
However, the Labor Department said the number of Americans
filing initial unemployment benefits claims rose unexpectedly last
week to 627,000, the highest level in more than a month.
"We still have a long way to go before we're out of the current
recession," said Christoffer Moltke-Leth, head of sales trading
for Saxo Capital Markets in Singapore. "Supply and demand
fundamentals have to come back into play."
Moltke-Leth said the oil price will likely rise to $75 a barrel
before drifting to near $60 by the end of the year as investors
become disillusioned by a sluggish economic recovery.
Oil was bolstered by fears another attack by Nigerian militants
on the West African country's oil installations could crimp
Nigerian President Umaru Yar'Adua offered amnesty Thursday to
Movement for the Emancipation of the Niger Delta fighters if they
hand over weapons and renounce armed struggle hours after militants
said they attacked a Royal Dutch Shell pipeline.
"It's a small supply issue, but it's enough to create some
buying interest," Moltke-Leth said.
In other Nymex trading, gasoline for July delivery was steady at
$1.89 a gallon and heating oil gained 0.52 cent to $1.78. Natural
gas for July delivery climbed 3.9 cents to $3.88 per 1,000 cubic
In London, Brent prices rose 42 cents to $70.20 a barrel on the
ICE Futures exchange.