Crude Oil Ends Above $51 A Barrel As Tension In Yemen Rises

(RTTNews) - U.S. crude oil soared to ended higher for a fifth straight session on Thursday, amid increased concerns of supply disruption from the Middle East after Saudi Arabia launched air strikes on Yemeni rebels.

The increased tensions in Yemen has pushed oil prices higher despite an official weekly oil report from the U.S. Energy Information Administration showed crude stockpiles to have risen more than expected last week, for an eleventh straight week.

Saudi Arabia and others are aiming to stabilize Yemen, where rebels are on the verge of deposing President Abdu Rabbu Mansour Hadi. On Wednesday, Mansour Hadi fled the southern port city of Aden even as Iranian-backed Houthi militants closed in on several important regions of Yemen.

Fearing supplies from the Middle East may be interrupted by an escalation in the conflict, crude oil prices have shot higher this week.

An estimated 4.0 million barrels of oil pass through Bab el-Mandeb Strait daily and any disruption to the shipping route would prevent tankers in the Persian Gulf from reaching the Suez Canal and as well as the SUMED Pipeline. The alternate route would be to go around the tip of Africa.

Light Sweet Crude Oil futures for May delivery, the most actively traded contract, surged $2.22 or 4.5 percent to settle at $51.43 a barrel on the New York Mercantile Exchange Thursday.

Crude prices for May delivery scaled a high of $52.48 a barrel intraday and a low of $48.73.

On Wednesday, U.S. crude futures for May delivery surged $1.70 or 3.6 percent to settle at $49.21a barrel, despite a weekly oil report from the Energy Information Administration indicated crude stockpiles to have risen more than expected last week for an eleventh straight week.

The U.S. Energy Information Administration said U.S. commercial crude inventories increased by 8.17 million barrels last week, with total U.S. commercial crude inventory at 466.7 million barrels.

The dollar index, which tracks the U.S. unit against six major currencies, traded at 97.34 on Thursday, up from its previous close of 96.93 on Wednesday in late North American trade. The dollar scaled a high of 97.39 intraday and a low of 96.17.

The euro trended lower against the dollar at $1.0875 on Thursday, as compared to its previous close of $1.0970 in North American trade late Wednesday. The euro scaled a high of $1.1056 intraday and a low of $1.0866.

On the economic front, a Labor Department report on Thursday showed initial jobless claims pulled back more than expected in the week ended March 21, after reporting a modest uptick in first-time claims for U.S. unemployment benefits in the previous week. Initial jobless claims fell to 282,000, a drop of 9,000 from the previous week's unrevised level of 291,000. Economists expected jobless claims to edge down to 290,000.

Elsewhere, German consumer confidence is set to improve further to its highest level in more than 13 years in April, as weak euro and low inflation function as mini stimulus to the economy, survey data from the market research group GfK showed Thursday. The forward-looking consumer sentiment index rose to 10 in April from 9.7 points in March. This was the highest score since October 2001. The index was expected to rise marginally to 9.8.

The French economy grew marginally as initially estimated in the fourth quarter, final data from the statistical office Insee showed Thursday. Gross domestic product rose 0.1 percent sequentially following third quarter's 0.3 percent increase. The rate came in line with the estimate published on February 13.

French unemployment increased in February following a decline in the prior month, the labor ministry reported late Wednesday. The number of people out of work rose by 12,800 from January to 3.49 million. It increased by 0.4 percent on a monthly basis and 4.6 percent from last year.

The leading Index for France, which measures the future economic activity, increased in January, after remaining unchanged in the previous month, survey figures from Conference Board showed Wednesday. The Conference Board leading economic index rose 0.2 percent in January, after staying flat in December. In November, the index had risen 0.1 percent.

British retail sales continued to expand in February at a faster-than-expected pace, suggesting strong support from domestic spending to economic growth in the first quarter. Retail sales increased at a faster pace of 0.7 percent in February from January, when it gained 0.1 percent, data from the Office for National Statistics revealed Thursday.

The monthly growth exceeded a 0.4 percent rise forecast by economists and marked the fifth straight month of growth.

U.K. retail sales picked up in March after growth nearly halted in February, Distributive Trades survey from the Confederation of British Industry showed Thursday. The retail sales balance rose to 18 percent from 1 percent in February. Nonetheless, it was below expectations of 27 percent.