Crude oil extends gains for a second straight day amid signs of demand growth in the United States and potential supply-side pressures in Europe. File photo by Monika Graff/UPI |
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NEW YORK, June 29 (UPI) -- Crude oil prices rebounded for a second straight day on word of a possible labor strike for Norwegian oil workers and steady demand in the United States.
Crude oil prices collapsed, along with global stock markets, on Friday when it emerged that the European Union would evolve without the United Kingdom. Speaking from London, British Energy and Climate Change Secretary Amber Rudd said the British economy faces a long period of uncertainty as it divorces from the EU.
"There have been significant advantages to us trading energy both within Europe and being an entry point into Europe from the rest of the world," she said in a statement.
Overseas, a slight uptick in the revision for first quarter growth in the United States helped lift crude oil prices higher during the Tuesday session. Data published late Tuesday from the American Petroleum Institute show crude oil inventories shrank by 3.9 million barrels in an indication the U.S. economy was taking advantage of lower fuel prices.
Lackluster demand last year helped add support to sustained losses in crude oil prices. The price for Brent crude oil was up 0.8 percent in early Wednesday trading to start the day at $49.00 per barrel. West Texas Intermediate, the U.S. benchmark price for oil, was up 1 percent to open at $48.34 per barrel.
Supply-side pressures helped lift crude oil prices close to the $50 mark as wildfires in Canada and militant threats in Nigeria curbed production in May and in early June. About 2 percent of the world's total oil production may be at stake unless wage concessions are brokered for Norwegian oil and gas workers before Friday, according to the Wall Street Journal.
Some of the rally may be in response to bargain hunting in the wake of the two-day market collapse that followed the British referendum. Data from the U.S. Commerce Department show personal income and disposable personal income increased each by 0.2 percent in May. That's the second-lowest level for a monthly increase this year and is 0.3 percent lower than for April.
While employment prospects in the United States remain robust, wage growth has been noticeably absent.
