Crude Steady Above $96.50 Amid Cheerful Data From US And Europe

Positive economic data from the United States and Europe determined markets to become more optimistic about the world economy, pushing crude above $96.50 as the outlook for demand on oil is brightening.

Crude is trading as of this writing around $96.65 a barrel level compared with the opening at $96.59 and with the highest at $96.69 and the lowest at $96.50. On the short term crude finds support at $96.50 then at $95.40 and resistance at $97.00 then at $97.30.

The U.S. services continued to expand in January to 55.2 from 55.0 expected, while Europe`s business activity showed signs of recovery rising in January to a 10-month high of 48.6 from 47.2 in December, supporting oil prices.

This helped ease the worries over Europe that were triggered as the political uncertainties in Spain and Italy threatened to disrupt the eurozone`s efforts to solve the debt crisis. But now investors are eyeing ECB’s and BoE’s monetary policy meetings on Thursday.

Investors are also awaiting China`s trade numbers on Friday to get clues on the health of the global economy and what it may mean for commodities demand, and will be monitoring the companies’ earnings and the latest developments in the Middle East.

Iran and the U.S. are expected to hold direct talks on the nuclear program on February 25, especially since starting today and under the tighter US sanctions, customers such as China, Japan and India will be restricted to use their own currencies when buying Iranian oil.

Meanwhile, data from the American Petroleum Institute (API) showed that crude stockpiles rose by 3.6 million barrels last week compared with an expected rise of 2.8 million barrels, but eyes are turning to today’s U.S. Department of Energy report.

Crude stockpiles probably rose 2.65 million barrels last week on higher imports and lower refining activity. Gasoline supplies probably increased 0.9 million barrels and distillate inventories including eating oil and diesel, probably declined by 625,000.

Brent is trading as of this writing around the $116.67 after rising 0.13%; natural gas is trading at $3.41 per 1,000 cubic feet after rising 0.32%; gasoline is trading at $3.0421 a gallon after rising 0.15%; heating oil is trading at 3.196 after rising 0.15%.