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Crude oil futures - weekly outlook: May 12 - 16

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Shutterstock photo - - New York-traded crude oil futures briefly rose to a two-week high on Friday before turning lower as a broadly stronger U.S. dollar prompted investors to lock in recent gains.

On the New York Mercantile Exchange, West Texas Intermediate crude oil for delivery in June rose to a session high of $101.18 a barrel, the most since April 29, before turning 0.27% lower to subsequently settle at $99.99 a barrel by close of trade.

Futures were likely to find support at $99.32 a barrel, the low from May 6 and resistance at $102.19 a barrel, the high from April 29.

For the week, Nymex oil futures lost 0.23%, or 23 cents a barrel, the fourth consecutive weekly decline.

The U.S. dollar rallied to a one-month peak against the euro on Friday, extending steep gains from the previous session after the European Central Bank indicated that it could ease monetary policy as soon as next month.

The U.S. Dollar Index, which tracks the performance of the greenback against a basket of six other major currencies, advanced 0.57% on Friday to end the week at 79.92, the most since April 30.

Oil prices typically weaken when the U.S. currency strengthens as the dollar-priced commodity becomes more expensive for holders of other currencies.

Futures were higher earlier in the day amid easing concerns over a slowdown in demand from China. Data released Friday showed that consumer price inflation in China rose 1.8% in April from a year earlier, less than market expectations for a 2.0% gain.

On Thursday, official trade data showed that China's surplus widened to $18.45 billion in April from a surplus of $7.7 billion in March, compared to estimates for a surplus of $13.9 billion.

Exports climbed 0.9% from a year earlier, beating expectations for a 1.7% decline and following a 6.6% drop in March. Imports rose 0.8%, compared to forecasts for a 2.3% decline and after plunging 11.3% in the previous month.

China is the world's second largest oil consumer after the U.S. and has been the engine of strengthening demand.

Meanwhile, market players continued to weigh uncertainty surrounding developments in Ukraine. Russian President Vladimir Putin called on pro-Russia separatists in the eastern reaches of the country to postpone their referendum on independence.

However, the separatists said they plan to go ahead on Sunday with a vote that some fear could lead to a civil war.

Russia produced 10.4 million barrels of oil per day in 2012 and exported 7.4 million, making it the world's second largest oil exporter after Saudi Arabia.

In the week ahead, investors will be looking to U.S. data on retail sales, consumer prices and consumer sentiment for further indications on the strength of the economy and the need for stimulus.

Data from the Commodities Futures Trading Commission released Friday showed that hedge funds and money managers decreased their bullish bets in New York-traded oil futures in the week ending May 6.

Net longs totaled 299,543 contracts, down 9.4% from net longs of 330,710 in the preceding week.

Elsewhere, on the ICE Futures Exchange in London, Brent oil for June delivery dipped 0.14%, or 15 cents, on Friday to settle at $107.89 a barrel by close of trade.

The June Brent contract lost 0.64% or 70 cents a barrel on the week.

Meanwhile the spread between the Brent and the WTI crude contracts stood at $7.90 a barrel by close of trade on Friday, compared to $8.83 in the preceding week. offers an extensive set of professional tools for the financial markets.

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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

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