International Oil Prices Closed up 1.48% to US$75.48/Barrel

Driven by factors such as the rise in the stock market and an increase in IEA crude oil demand expectations, New York Mercantile Exchange (NYMEX) crude oil futures rose to a four-week high on the 10th, closing up 1.48%, exceeding US$75 per barrel, to US$75.48 per barrel. The contract hit its highest settlement price since May 12, with the intraday trading range being $73.72-76.30. This is also the third consecutive trading day of higher crude oil futures, the first time since the end of April that there have been three consecutive days of gains.

ICE July Brent crude oil futures closed up $1.02, or 1.37%, at $75.29 a barrel, marking the fourth consecutive day of gains, with an intraday trading range of $73.68-75.88.

Traders said buying interest was fueled by the euro's strength against the dollar and a slight increase in its 2010 global oil demand forecast from the International Energy Agency. The settlement price of crude oil futures failed to break through the high of $75.72 on May 28. If a breakthrough is achieved, it means that the price will rush to $78.

Tom Bentz, a broker and analyst at BNP Paribas in New York, said there are risks in staying long at the high end of the $70-$80 range. He expects the recent fluctuation range of crude oil futures to be 68-78 US dollars.

In its latest report, the International Energy Agency slightly raised its forecast for global oil demand in 2010 by 60,000 barrels per day, and expected daily demand to increase by 2% (or 1.7 million barrels) over the previous year. However, crude oil inventories held by members of the Organization for Economic Co-operation and Development (OECD) are increasing, the agency said. As of the end of April, OECD inventories could meet 60.5 days of demand, more than 1 day more than the end of March.

The agency also warned that the slowdown in the euro zone economy caused by sovereign debt problems may inhibit future growth in China's crude oil demand driven by exports. China is the world's second largest crude oil consumer after the United States. It is expected that 40% of the global crude oil demand growth in 2010 will come from China, and in the International Energy Agency's expectations for demand growth from 2010 to 2015, China's Contribution accounts for 45%.

The latest data from China showed that crude oil imports in May fell 16% from a record high in April, but were still up 4.4% from a year earlier.

However, traders said markets were becoming more focused on broader economic issues. Tim Evans, an analyst at Citi Futures Perspective in New York, said oil supply and demand fundamentals are taking a backseat to the dynamics of the stock market as a secondary factor in price. In the short term, all oil traders need to know whether the S&P 500 is moving up or down. The index moved higher on the 10th, so the crude oil market also moved higher.

The July RBOB gasoline futures contract settled up 3.08 cents, or 1.5%, at $2.0705 per gallon, a one-week high. July heating oil futures settled up 2.32 cents, or 1.2%, at $2.0328 a gallon (also a one-week high).