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Oil hovers above $85 in Asia as traders look to Bernanke comments on economy
SINGAPORE (AP) ' Oil hovered above $85 a barrel Thursday in Asia amid speculation the U.S. may implement stimulus measures to boost a flagging recovery.
Benchmark oil for July delivery was up 7 cents to $85.09 per barrel at late afternoon Singapore time in electronic trading on the New York Mercantile Exchange. The contract rose 73 cents to settle at $85.02 in New York on Wednesday.
In London, Brent crude for July delivery was down 42 cents at $100.22 per barrel on the ICE Futures exchange.
U.S. Federal Reserve Chairman Ben Bernanke is scheduled to speak to Congress later Thursday, and investors will be closely watching for any evidence the central bank plans another round of Treasury purchases, known as quantitative easing.
Oil has dropped from $106 early last month to below $82 on Monday amid signs of slowing economic growth and crude demand in Europe, the U.S. and China.
"Given the extent of the sell-off in crude oil, we believe that it could rebound quickly if policymakers take steps to lift the fog of uncertainty," Goldman Sachs said in a report. "We expect that policymakers will be providing more clarity throughout the month of June."
Previous stimulus programs have sent commodities and stock markets higher. Boosting money supply has also tended to weaken the U.S. dollar, which makes commodities traded in dollars such as oil cheaper for investors with other currencies.
U.S. employment growth has disappointed analysts in recent months, and traders will be eyeing jobless claims for last week, which are scheduled to be announced later Thursday.
"Maintaining the upward momentum will likely require much assistance from jobless claims as well as some quantitative easing hints out of Bernanke," energy trader and consultant Ritterbusch and Associates said in a report.
In other energy trading, heating oil was down 1 cent at $2.66 per gallon while gasoline futures slid 0.8 cents at $2.68 per gallon. Natural gas dropped 0.3 cents at $2.42 per 1,000 cubic feet.
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