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Oil prices dip on US housing data | |
(about 2 hours later) | |
Oil prices have dipped from a six-month high after weak housing data was released by the US Commerce Department. | |
Oil had earlier edged above $60 a barrel amid renewed hopes of a recovery in the US economy. | |
But by late afternoon US crude had fallen back to $59.08 from $60.48, while London Brent crude lost early gains, slipping to $58.41. | |
New US housing starts fell 12.8% in April to an annual rate of 458,000 units - the lowest on record. | |
Oil prices have risen about 20% from $50 a barrel over the last three weeks as optimism about the state of the world economy has grown. | |
And on Monday, prices had risen sharply amid fears that attacks on oil facilities in Nigeria could lead to shortages in oil supply. | |
Oil has jumped from $32 a barrel in January, but it remains well below the record high of $147 touched last July. | Oil has jumped from $32 a barrel in January, but it remains well below the record high of $147 touched last July. |
'Resilient' | 'Resilient' |
A strong US economy can benefit the price of oil - both because of increased domestic demand but also because it is a major export market for many countries. | A strong US economy can benefit the price of oil - both because of increased domestic demand but also because it is a major export market for many countries. |
"Oil seems to stay resilient in spite of ample supply as it continues to focus on the prospects of economic recovery and the rising risk of commodity price inflation," said Phil Flynn at Alaron Trading. | "Oil seems to stay resilient in spite of ample supply as it continues to focus on the prospects of economic recovery and the rising risk of commodity price inflation," said Phil Flynn at Alaron Trading. |
There are also continued fears that attacks on oil facilities in Nigeria could hit supplies. | There are also continued fears that attacks on oil facilities in Nigeria could hit supplies. |
On Monday, oil prices rose after militants in Nigeria, Africa's leading oil producer, attacked two oil pipelines in the southern Niger Delta. | On Monday, oil prices rose after militants in Nigeria, Africa's leading oil producer, attacked two oil pipelines in the southern Niger Delta. |