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Oil price rises, natgas at US$2.79
NEW YORK—A brighter outlook for US homebuilders and rising industrial production pushed the price of oil higher yesterday for the fifth straight day. Benchmark US crude added 79 cents to end the day at US$89.22 per barrel in New York. Brent crude, which is used to set the price of oil imported into the US, rose by 63 cents to end at US$104 per barrel in London.
A survey by the housing industry showed that confidence among homebuilder soared to a five-year high on the expectation that new home sales will rise this year. Home building is a key part of the economic recovery. Every time a new home is built, it creates three jobs for a year and generates about US$90,000 in tax revenue, according to the National Association of Home Builders.
Meanwhile, US industrial production rose in June. The Federal Reserve said factories made more cars, machines and business equipment. The manufacturing industry has struggled to maintain steady growth this year, but analysts said the news was enough to ease concerns about a slowing economy. “The economy looks a little better today,” said Phil Flynn with Price Futures Group.
Oil prices were down earlier in the day after Fed Chairman Ben Bernanke gave lawmakers a dour outlook for the economy. Investors had hoped that Bernanke would discuss a new stimulus plan before the Senate Banking Committee. He didn’t. Instead, Bernanke warned that the country could be headed for another recession, if Congress doesn’t avert a looming budget crisis.
In other futures trading, heating oil rose 1.45 cents to finish at US$2.8422 per gallon, while wholesale gasoline lost a penny to end at US$2.8450 per gallon. Natural gas fell by less than a penny to finish the day at US$2.7960 per 1,000 cubic feet.
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