West Texas Intermediate crude rose for a second day after the Federal Reserve said it will reduce stimulus as the nation’s economic outlook improves and as U.S. fuel consumption increased.
Prices gained as much as 0.9 percent. The Fed is trimming its monthly bond purchases, “reflecting cumulative progress and an improved outlook for the job market,” Chairman Ben S. Bernanke said at a press conference yesterday. Total U.S. petroleum demand increased last week to the most since 2008, according to the Energy Information Administration.
“The Fed signaled that the economy is in a better shape than people had thought, and that’s bullish for crude oil,” said Michael Lynch, president of Strategic Energy & Economic Research in Winchester, Massachusetts. “Stronger demand is suggesting that consumers are actually spending.”
WTI for January delivery, which expires today, rose 86 cents, or 0.9 percent, to $98.66 a barrel at 11:37 a.m. on the New York Mercantile Exchange. The more-active February contract gained 85 cents to $98.91. The volume of all futures traded was 35 percent below the 100-day average.
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