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NEW YORK: Oil prices rose Wednesday as the market reacted favorably to signs of an increase in future demand in China and a further loosening of the recession’s grip in the U.S.
That trumped data showing a continued slump in the nation’s appetite for oil.
Benchmark crude for September delivery climbed 71 cents to settle at $70.16 a barrel on the New York Mercantile Exchange. In London, Brent prices added 43 cents to settle at $72.89 a barrel on the ICE Futures exchange.
Prices jumped in morning trading after the government said the U.S. trade deficit increased slightly in June. The Commerce Department reported that imports rose for the first time in 11 months.
The International Energy Agency, based in Paris, said demand for crude this year may not be as weak as once thought, largely because of China.
The reports from both sides of the Atlantic were enough to offset news that crude supplies continue to grow in the U.S.
The U.S. Energy Information Administration said oil placed into storage rose for the third straight week.
Gas prices are certainly much lower than they were last year, but the bulging supplies of crude haven’t resulted steadily decreasing gas prices as the driving season nears an end.
Refiners continue to cut back on production, which has kept gasoline prices relatively stable for the past month or so.
Pump prices added two-tenths of a penny overnight to a new national average of $2.645 a gallon. A gallon of regular unleaded is 11.6 cents more expensive than it was last month, but it’s still $1.154 cheaper than the same time last year.
While prices have risen slowly for weeks, prices at the pump are about where they were at the end of June.