Crude oil futures surged through 70 dollars a barrel after a U.S. government report showed an unexpected decline in gasoline supplies. Gasoline inventories fell 1.66 million barrels to 211.5 million in the week ended September 25, the Energy Department said today in a weekly report. Stockpiles were forecast to increase by 1 million barrels, according to the median of analyst estimates in a Bloomberg News survey.
"Gasoline had been pummeled in the past few weeks, price- wise," said Antoine Halff, head of energy research at Newedge USA LLC in New York. "This provides some price relief, and gasoline is pulling crude higher. Gasoline seems to be the driver today."
Crude oil for November delivery rose 3.85 dollars, or 5.8%, to close at 70.56 dollars a barrel on Nymex. Futures hit an intraday high of 70.72, the highest since September 23. Oil traded at 66.44 dollars a barrel before the release of the inventory report.
Crude oil gained 1% this quarter, a third consecutive quarterly gain.
Commodities like Silver and Gold also surged today on what was seen as an "inflation fear trade". But the real data that hit the wires today was the less then exhuberant Chicago PMI that came at "recession level", 46.1. The month of October will start with nothing short of 8 important economic data points: Personal Income, Personal Spending, Initial Claims, Continuing Claims, Construction Spending, ISM Index, Pending Home Sales, Auto Sales and Truck Sales. So, probably the volatility is here to stay.
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