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WTI Crude Poised for Longest Run of Weekly Gains Since 2009

Jan. 25 (Bloomberg) -- Crude headed for a seventh weekly advance in New York, the longest run of gains in almost four years, amid signs of global economic growth and concern that oil facilities in North Africa are vulnerable to militant attacks.

West Texas Intermediate crude advanced as much as 0.6 percent as German business confidence rose for a third month in January. The European Central Bank said 278 banks will hand back 137.2 billion euros ($184.4 billion) of its three-year loans next week at the first opportunity for early repayment. The U.K., German and Dutch governments yesterday urged their citizens to leave the Libyan city of Benghazi.

“Global risk sentiment remains fairly upbeat,” said Andrey Kryuchenkov, a commodities analyst at VTB Capital in London, who predicts WTI will trade from $93 to $97 a barrel over the next month.

Crude for March delivery gained as much as 54 cents to $96.49 a barrel and was at $96.38 in electronic trading on the New York Mercantile Exchange at 12:30 p.m. London time. Futures climbed 0.8 percent to $95.95 yesterday and are up 0.9 percent this week. A seventh weekly gain would be the longest rising streak since April 2009. The average volume of all futures traded today was 18 percent below the 100-day average.

Brent for March settlement gained as much as 56 cents to $113.84 a barrel on the London-based ICE Futures Europe exchange, the highest since Oct. 17. The European benchmark contract was at a premium of $17.35 after contracting to $15.16 on Jan. 17, the narrowest in almost six months.

Business Confidence

The German Ifo institute’s business climate index, based on a survey of 7,000 executives, climbed to 104.2 from 102.4 in December. That’s the highest since June. Economists predicted a gain to 103, according to the median of 41 forecasts in a Bloomberg News survey.

WTI declined 7.1 percent in 2012 as the U.S. shale boom deepened a supply glut at Cushing. That left it at an average discount of $17.47 a barrel to Brent last year, compared with a premium of about 7 cents in the five years through 2010. Brent, the benchmark grade for more than half the world’s crude, advanced 3.5 percent last year.

New York futures dropped relative to Brent this week after Enterprise Products Partners LP said deliveries via the Seaway pipeline to the Jones Creek, Texas, terminal were limited. The system, which runs from Cushing to refineries near Houston, was operating at a rate higher than 175,000 barrels a day, company spokesman Rick Rainey said yesterday, without giving a specific figure. Houston-based Enterprise and its partner, Enbridge Inc., completed an expansion of Seaway on Jan. 11 that boosted capacity to 400,000 barrels a day.

Cushing Inventories

Inventories at Cushing, Oklahoma, the delivery point for WTI, decreased for the first time since November, according to the Energy Information Administration. Cushing stockpiles slid 471,000 barrels to 51.4 million in the seven days ended Jan. 18, the first decline in seven weeks, the EIA’s report showed. Total U.S. crude inventories climbed 2.8 million barrels to 363.1 million. Supplies were forecast to increase 2.2 million barrels, according to the median estimate of 10 analysts surveyed by Bloomberg News.

Gasoline stockpiles decreased 1.7 million barrels to 233.3 million, the report showed. They were projected to rise 1.3 million barrels, according to the Bloomberg survey. Distillate inventories, including heating oil and diesel, rose 508,000 barrels to 132.9 million, compared with a prediction for supplies to be unchanged.

Prices may rise next week, a separate Bloomberg survey of 36 analysts showed. Eighteen of 36 analysts surveyed by Bloomberg, or 50 percent, forecast crude will increase through Feb. 1. Eleven respondents, or 31 percent, predicted a drop. Seven said there would be little change. Last week, 39 percent of analysts projected a gain.

Libya Security

Oil in New York has long-term technical support along its 100-week moving average, around $95 a barrel, according to data compiled by Bloomberg. Futures have halted intraday declines near this indicator in the four days through yesterday. Buy orders tend to be clustered close to chart-support levels.

Libya, a member of the Organization of Petroleum Exporting Countries, pumped an average of 1.54 million barrels of oil a day last month, according to data compiled by Bloomberg. The country is reinforcing security at oil and gas installations near its southern border after last week’s terrorist attack in Algeria.

The Jan. 16 al-Qaeda-linked assault on a natural gas plant partly run by BP Plc resulted in the deaths of at least 38 foreign hostages. The terrorists were wore Libyan uniforms, Algeria’s privately run Ennahar television said on its website last week, citing government officials it didn’t identify.

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