Friday, Jun 29, 2012
By Gurdeep Singh & Eric Yep
Crude-oil futures jumped higher in Asian trade Friday after euro-zone leaders said they had agreed on measures to help the region's struggling banks and debt-ridden governments.
On the New York Mercantile Exchange, light, sweet crude futures for delivery in August traded at $79.34 a barrel at 0342 GMT, up $1.65 in the Globex electronic session. August Brent crude on London's ICE Futures exchange rose $1.38 to $92.74 a barrel.
EU leaders pledged to eventually allow direct recapitalization of euro-zone banks and to open access to the region's rescue funds to countries not already receiving assistance. They also agreed that the bailout fund, the European Stability Mechanism, will not have senior creditor status when it takes over the loans granted to Spain for its ailing banks.
Oil prices shot up after comments following the EU meeting, but sentiment remained cautious because relief over previous measures to solve the euro-zone crisis has usually been short-lived.
"Any positive news from the EU summit will only be temporary. We think that it won't be a game-changer" and the rally in crude-oil prices will likely be temporary also, said Barnabas Gan, an analyst at OCBC Bank.
German Chancellor Angela Merkel said euro-zone leaders had made good short-term decisions and that further work would be needed on long-term solutions.
Nymex reformulated gasoline blendstock for July--the benchmark gasoline contract--rose 96 points to $2.6238 a gallon, while July heating oil traded at $2.5700, 181 points higher.
ICE gasoil for July changed hands at $826.50 a metric ton, up $4.75 from Thursday's settlement.
Write to Gurdeep Singh at gurdeep.singh@dowjones.com
(END) Dow Jones Newswires
June 29, 2012 00:29 ET (04:29 GMT)
