Crude Oil Rebounds To End Sharply Higher

(RTTNews) - U.S. crude oil rebounded strongly to end sharply higher Wednesday, after an official weekly oil report from the Energy Information Administration showed U.S. crude oil inventories to have risen last week, albeit less than what analysts expected. This, coupled with a weak dollar helped oil prices recoup yesterday's losses, when it fell to a three-month low -- shedding about 1.3 percent.

The Energy Information Administration's weekly oil report showed U.S. crude oil inventories to have gained 1.60 million barrels, while gasoline stocks shed 3.80 million barrels in the week ended November 1. Analysts expected crude oil inventories to add 1.90 million barrels and gasoline stocks to shed 0.30 million barrels last week.

Light Sweet Crude Oil futures for December delivery, the most actively traded contract, surged $1.43 or 1.5 percent to close at $94.80 a barrel on the New York Mercantile Exchange Wednesday.

Crude prices for December delivery scaled a high of $95.40 a barrel intraday and a low of $93.65.

Yesterday, oil dipped to settle at a three-month low amid concerns of a further increase in supplies even as the dollar strengthened against a band of select currencies. Investors weighed the prospects of burgeoning inventories over the last six weeks.

Tuesday after the market hours, the API said US crude oil inventories moved up 0.87 million barrels and gasoline stocks fell 4.30 million barrels in the weekended November 01.

The dollar index, which tracks the U.S. unit against six major currencies, traded at 80.50 on Wednesday, down from 80.70 late Tuesday in North American trade. The dollar scaled a high of 80.72 intraday and a low of 80.38.

The euro traded higher against the dollar at $1.3519 on Wednesday, as compared to its previous close of $1.3475 late Tuesday in North America. The euro scaled a high of $1.3547 intraday and a low of $1.3468.

In economic news, a Conference Board report on Wednesday showed the U.S. economy to have expanded modestly before the government shutdown, with its index of leading economic indicators rising in line with estimates in September. The leading economic index rose by 0.7 percent in September following a matching increase in August. The increase was in line with economists' estimates.

In economic news from the eurozone, Germany's private sector growth remained unchanged in October, final survey data from Markit Economics showed. At 53.2 in October, the seasonally adjusted final composite output index which measures the combined output of the manufacturing and service sectors - was unchanged from September and comfortably above the 50.0 no-change value, it said Wednesday. The flash reading for October was 52.6.

Germany's factory orders grew 3.3 percent in September from the previous month driven by robust foreign demand, official data showed. Orders were forecast to grow 0.5 percent, following a 0.3 percent drop in August.

Meanwhile, eurozone private sector business activity expanded at a slightly faster pace than previously estimated in October, detailed results of a survey by Markit Economics showed. However, the rate of expansion remained weaker than that of September. The composite output index, an indicator that measures performance of both manufacturing and service sectors, came in at 51.9, higher than the flash reading of 51.5. In September, the index stood at 52.2, a 27-month high.

Eurozone retail sales declined slightly more than expected in September driven by the weakness in both food and non-food product turnover. The volume of retail sales dropped 0.6 percent month-on-month, reversing the 0.5 percent rise in August, Eurostat reported. Economists had forecast sales to fall 0.4 percent in September.