“Oil rebounded from the lowest level in almost four months in New York on speculation that the biggest decline this year was exaggerated.
West Texas Intermediate climbed as much as 1.4 percent, after its 14-day relative strength index plunged to 38.5 yesterday, a sign that prices may be oversold. Crude slumped 4.8 percent yesterday after U.S. stockpiles gained and fuel demand dropped, while President Barack Obama’s re-election stoked concern that the struggle to resolve deficit-reduction talks may harm the economy.
“Oil prices have experienced quite a rollercoaster ride in the past days, and today’s move looks like technical trading as traders re-balance their positions after the election,” said Michael Poulsen, an analyst at Global Risk Management in Middelfart, Denmark. “There’s a slight bias to the upside today that might mean room for a move up of $1 or so.”
Oil for December delivery rose as much as $1.16 to $85.60 a barrel in electronic trading on the New York Mercantile Exchange. The contract was at $85.51 at 12:45 p.m. London time. It lost $4.27 yesterday to $84.44, the lowest close since July 10. Prices are down 13 percent this year.
Brent for December settlement on the London-based ICE Futures Europe exchange gained as much as $1.11, or 1 percent, to $107.93 a barrel. It slid $4.25, or 3.8 percent to $106.82 yesterday. The benchmark grade for more than half the world’s oil was at a premium of $22.25 to New York crude. The spread widened to a one-week high of $22.38 yesterday.”
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