Business

The Canadian Press - ONLINE EDITION

Oil steady near $93 in Europe as markets recover their poise from Bernanke low rates comment

By: Pablo Gorondi, The Associated Press

Posted: 02/26/2013 3:36 AM | Comments: 0 | Last Modified: 02/27/2013 8:18 AM

Oil pumps work in the desert oil fields of Sakhir, Bahrain, on Nov. 29, 2012. THE CANADIAN PRESS/AP, Hasan Jamali

The price of oil was little changed near $93 a barrel on Wednesday as markets digested the Federal Reserve chairman's fairly sanguine view about the risks emanating from the central bank's super-easy monetary policy.

By early afternoon in Europe, benchmark crude for April delivery was up 7 cents to $92.70 a barrel in electronic trading on the New York Mercantile Exchange. The contract fell 48 cents Tuesday to settle at $92.63.

In the opening remarks of his semiannual report to Congress on Tuesday, Fed Chairman Ben Bernanke signalled that the Fed's efforts to keep borrowing costs low will continue. Bernanke expressed confidence that the central bank's policies, which include near zero per cent interest rates, currently pose little risk to inflation or a stock market bubble.

His comments doused worries the Fed might soon start scaling back its monetary stimulus. Bernanke's comments helped stabilize markets after inconclusive Italian election results triggered renewed concerns over Europe's debt crisis.

A continuation of easy monetary policy in the U.S. would also maintain the downward pressure on the dollar and potentially boost the price of oil since it is traded in dollars, and might be more affordable for investors with other currencies.

"The commodity markets continue to remain cautious but more stable as investors are trying to digest the results from the Italian's elections," said a report from Sucden Financial Research in London. "It seems that the optimistic comments from Bernanke overshadowed the political uncertainty of the eurozone and raised hopes about a possible rebound in the oil demand for the rest of 2013."

Investors will also be monitoring fresh information on U.S. stockpiles of crude oil. Data for the week ending Feb. 22 are expected to show a build of 2.6 million barrels in crude oil stocks, according to a survey of analysts by Platts, the energy information arm of McGraw-Hill Cos.

In London, Brent crude was up 18 cents at $112.89 on the ICE futures exchange.

In other energy futures trading on Nymex:

— Wholesale gasoline was down 0.23 cent at $3.1965 a gallon.

— Heating oil added 0.72 cent to $3.034 a gallon.

— Natural gas retreated 0.2 cent to $3.436 per 1,000 cubic feet.

Fact Check

Have you found an error, or know of something we’ve missed in one of our stories? Please use the form below and let us know.

* Required

In which story did you find the error? *
Please post the headline of the story or the title of the video with the error.
What was the error? *
Please post exactly what was wrong with the story.
What should we have written?
Please indicate your source for the correct information.
Who else should we interview to improve this story?
Please include any contact information you may have.
Can we contact you in the future for advice on stories about this topic?
Yes

No
First Name: *
Last Name: *
E–mail Address: *
This will only be used to contact you if we have a question about your submission, it will not be used to identify you or be published.
Phone: *
This will only be used to contact you if we have a question about your submission, it will not be used to identify you or be published.
Colour:
Are you blue? If you can see this, leave it blank and get some CSS support.
Enter the words that you see: * This is to prevent our forms from being filled out automatically.
You have failed to correctly identify the words in the box above. Please try again.

More Business

Undock

You can comment on most stories on winnipegfreepress.com. You can also agree or disagree with other comments. All you need to do is register and/or login and you can join the conversation and give your feedback.

Have Your Say

New to commenting? Check out our Frequently Asked Questions.

The Winnipeg Free Press does not necessarily endorse any of the views posted. By submitting your comment, you agree to our Terms and Conditions. These terms were revised effective April 16, 2010.