Oil Rallies on Strong US Job Data. WTI-Brent Spread Widens

8 July 2011 8 July 2011

BonTrade

The market was at a 'risk on' mode as supported by strong economic data. Better-than-expected ADP payrolls and jobless claims data sent Wall Street higher and raised optimism on the June non-farm payroll which is due today. In the commodity sector, oil price rallied further with the front-month contract for WTI crude oil jumped to a 3-week high of 99.42 before settling at 98.67, up +1.04%, while the equivalent Brent crude contract surged to as high as 118.7 before closing at 118.59, up +4.37%. As crude prices have returned to levels before IEA's announcement of SPR release, the WTI-Brent spread widened again to as much as $20/bbl. Gold fluctuated between 1520 and 1535 but ended flat at 1530.6. The metal was torn between higher risk appetite and a weaker US dollar.