--Nymex September crude follows Brent higher, settles up at
$93.67 a barrel
--Hurricane Ernesto could reduce Mexican oil exports
--RBOB gains almost 7 cents after refinery fire in
California
(Adds Brent settlement price in second paragraph.)
By Nicole Friedman
NEW YORK--Crude-oil futures rose to a 12-week high Tuesday,
rallying on positive market sentiment and concerns about short-term
supply.
Light, sweet crude for September delivery rose $1.47, or 1.6%,
to $93.67 a barrel on the New York Mercantile Exchange, the highest
settlement price since May 15. Brent crude on ICE Futures Europe
rose $2.45, or 2.2%, to settle at $112 a barrel.
"It's not just oil running up here," said Carl Larry, an analyst
with Oil Outlooks & Opinions. "It's correlated directly to the
confidence in the markets."
Better-than-expected earnings reports boosted stock markets
Tuesday, with Standard & Poor's 500-stock index recently up
0.6% at 1403.15. Investors headed into riskier assets and out of
the U.S. dollar, weighing the dollar down and making dollar-traded
oil more affordable to foreign buyers.
Markets are also rising on anticipation of further stimulus
measures from the Federal Reserve and European Central Bank, said
Andy Lipow, president of Lipow Oil Associates, even though the
central banks failed to announce new initiatives at their most
recent meetings.
The U.S. government increased its estimates for the average
prices of oil and oil products in 2012, according to a monthly
report released at noon by the Energy Information Administration.
The EIA also raised its forecast for global use of oil by 190,000
barrel a day from its estimate last month. The higher demand
forecast "added further bullish fuel to this month's price rally,"
Jim Ritterbusch of Ritterbusch & Associates said in a note.
Traders are also eyeing supply concerns. Brent crude has seen
continued tight supplies from the North Sea due to maintenance
work, and a pipeline explosion Monday halted the flow of oil from
Iraq to a key Turkish port.
In addition, Hurricane Ernesto is expected to reach the Bay of
Campeche on Wednesday, potentially disrupting oil exports from
Mexico.
Analysts are expecting that U.S. oil inventories fell by 500,000
barrels in the week ended Aug. 3, according to a Dow Jones
Newswires survey. The inventory data, to be released at 10:30 a.m.
EDT Wednesday, could be a "primary price catalyst" influencing oil
futures, said Dominick Chirichella, oil analyst for Energy
Management Institute, in a note to clients.
Meanwhile, front-month reformulated gasoline blendstock, or
RBOB, rose above the $3 mark after a fire at one of the largest
U.S. refineries in California. September RBOB settled up 6.91
cents, or 2.4%, at $2.9913 a gallon.
September heating oil rose 5.71 cents, or 1.9%, to $2.9980 a
gallon.
More information on settlements and highs and lows for futures
on Nymex and ICE platforms can be found by searching for the
following headlines:
Nymex Light Crude Oil Close
Nymex Harbor RBOB Gasoline Close
Nymex Heating Oil Close
ICE Brent Crude Oil Close
ICE Gas Oil Close
Write to Nicole Friedman at nicole.friedman@dowjones.com