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Oil climbs on back of resurgent equity markets

8th Sep 2010, 4:21 pm Oil climbs on back of resurgent equity markets

Oil prices have been pushed a tad higher on Wednesday, after international equity markets turned around.

On the Chicago Mercantile Exchange, light sweet crude futures climbed around 40 cents to US$74.50/barrel.

In London the FTSE100, FTSE250 and FTSE All-share all added almost half a percent. Elsewhere European indices all climbed around 1%. In Paris the CAC40 gained just over one percent to 3,683, so did the Spanish IBEX and Italy’s MIB index.

The German DAX gained just under 1%.

The trend was very similar across the Atlantic, with both the DOW Jones and the S&P500 each advancing around 0.8%.

Oil prices usually track movements in share prices, which serve as an indicator of the strength of the economy and the outlook for energy demand.

Oil demand in the US has been in decline, which was reflected by substantial gains in crude inventories reported by the Energy Department. Last week, the US government revealed a massive increase of 3.4 million barrels, while the American Petroleum Institute (API) reported a gain of 4.8 million barrels.

The next round of weekly US inventory number starts tomorrow.

On the London Stock Exchange, the oil and gas major have moved inline with the broader trends.
BP (LON:BP) climbed around 1.3% to trade at 412p per share, while Royal Dutch Shell (LON:RDSB) also added 1% to trade at £17.66

Similarly the FTSE100’s other producers, Tullow Oil (LON:TLW) gained 1.3% and was last changing hands at £12.44. Cairn Energy (LON:CNE) added just 0.5%.

Among the mid-caps Premier Oil (LON:PMO), Dragon Oil (LON:DGO),  and SOCO International (LON:SIA) were also 1% higher.

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