Investing.com - Crude oil futures ended Friday's session lower,
retreating from a four-month high after data showing growing
inflation pressure in China dampened hopes for fresh stimulus from
the world's second largest oil consumer.
On the New York Mercantile Exchange, light sweet crude futures for
delivery in February declined 0.1% Friday to settle the week at
USD93.72 a barrel by close of trade.
Prices rose to USD94.69 a barrel on Thursday, the strongest level
since September 19, as the U.S. dollar came under heavy selling
pressure after the European Central Bank kept interest rates
unchanged at 0.75% and said a gradual economic recovery would begin
Robust Chinese trade data further supported gains. Chinese exports
grew 14.1% from a year earlier in December, blowing past
expectations for a 5% gain and up from a 2.9% increase in November.
On the week, New York-traded oil futures added 0.7%, the fifth
consecutive weekly gain.
Oil's losses on Friday came after official data showed that
consumer price inflation in China accelerated to a seven-month high
of 2.5% in December, up from 2% in November and above expectations
for a 2.3% increase.
Politically sensitive food costs accelerated 4.2% in December from
a year earlier. The rise in Chinese food costs was driven by a
14.8% increase in the price of vegetables.
The higher-than-expected reading dented expectations Beijing will
introduce fresh monetary easing measures in the near-term to boost
growth in the world's second largest economy.
China is the world's second largest oil consumer after the U.S. and
has been the engine of strengthening demand.
In the week ahead, investors will be anticipating a speech by
Federal Reserve Chairman Ben Bernanke on monetary policy and the
recovery from the global financial crisis on Monday, as well as
Tuesday's data on U.S. retail sales for December.
Market players will also be awaiting data from China on fourth
quarter gross domestic product for signs of a recovery in the
world's second-largest economy.
Elsewhere, on the ICE Futures Exchange in London, Brent oil futures
for February delivery dropped 1.2% Friday to settle the week at
USD110.58 a barrel.
The London-traded Brent contract lost 0.75% over the week, while
the spread between the Brent and the crude contracts stood at
USD16.86 a barrel, the lowest level since September.
The spread between the two contracts narrowed to a four-month low
following the restart of the Seaway pipeline on Friday, which was
shut since January 2 to complete a major expansion.
The expanded line will help alleviate a glut of crude in the
The flow to the Gulf from Cushing, Oklahoma, the delivery point for
the NYMEX oil futures contract, grew to 400,000 barrels a day from
the previous 150,000 barrels a day.
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