Oil prices rebound on US data

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London - Global oil prices staged a light rebound on Monday, reversing earlier losses after news of strong durable goods orders in top crude consumer the United States, dealers said.

In late afternoon London deals, Brent North Sea crude for delivery in March added seven cents to $113.35 per barrel, after earlier rising close to a three-month peak at $113.80.

New York's main contract, light sweet crude for March or West Texas Intermediate (WTI), increased by 37 cents to $96.25 a barrel.

New US orders for durable manufactured goods surged higher in December, led by a jump in commercial aircraft orders, government data showed.

Orders for durable goods - long-lasting products such as vehicles, computers and machinery - rose to $230.7-billion, up 4.6 percent from November, the Commerce Department said.

That was the seventh increase in the last eight months, following a 0.7 percent gain in November, and well above the 1.6 percent rise expected by analysts.

“We had decent durable goods orders estimates for December, beating expectations with a 4.6 percent month-on-month increase,” said VTB Capital analyst Andrey Kryuchenkov.

“Overall, it is still very quiet with US data supporting the downside as Brent recovers from intraday lows after an early pullback in small scale profit taking from last week's highs.

“Generally, WTI was better supported today, while Brent also suffered earlier from comments by OPEC Secretary General Abdullah al-Badri on plentiful supplies in the current year.”

At the same time, Monday's price gains were capped by worse-than-expected US pending home sales.

“While both the headline and core durable goods orders beat expectations, there was a big miss in the December pending home sales number,” noted Fawad Razaqzada, technical analyst at trading group GFT Markets.

Crude futures had fallen in earlier deals as many traders took the opportunity to cash in recent gains.

On Friday, Brent oil had struck a three-month peak at $113.84 on the back of a weaker dollar, upbeat German data and growing optimism over the global economic outlook, traders said. That was the highest level since mid-October.

Later this week, meanwhile, traders will switch focus to the outcome of the US Federal Reserve's two-day monetary policy meeting on Wednesday. - Sapa-AFP


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