Commodities: Recovery jitters takes oil below $80

Date: Wednesday 24 Feb 2010

Crude oil futures slipped below $80 a barrel, snapping a five-day winning streak, after US consumer confidence slumped to a 10-month low.

The new front-month April contract settled down $1.45 at $78.86 a barrel on the New York Mercantile Exchange.

Concern about a sustained economic recovery was prompted after the Conference Board’s index fell by 11 points to 46 from an upwardly revised 56.5 in January.

Losses among US equities and a disappointing house price report helped put an end to crude’s rally, as did the stronger dollar although some of the day’s losses were won back after data from the American Petroleum Institute said crude stockpiles fell a bigger than forecast 3.1m barrels. Analysts had forecast an increase of around 2m barrels.

Traders are awaiting the US Energy Information Administration weekly supply update on Wednesday.

The stronger dollar also reduced the appeal of gold. COMEX gold for April delivery declined $9.90 to settle at $1,103.20 per ounce in New York.

March silver fell 34 cents to $15.91 an ounce while copper for March delivery fell 9 cents to $3.22 a pound.

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