Crude Oil Ends Higher As IEA Lifts Demand Forecast

(RTTNews) - U.S. crude oil settled higher on Tuesday, as demand growth concerns eased after the International Energy Agency in a monthly report raised its demand growth forecast. Oil prices also found support with China moving to supply more liquidity into the system ahead of the Lunar New Year holidays, easing fears of a credit squeeze and a slowdown in demand for commodities.

The IEA in its monthly Oil Market Report earlier Tuesday, lifted its global oil demand forecast for the year 2014 by 1.3 million barrels per day on stronger-than-expected fourth quarter 2013 global oil demand.

Meanwhile, China's economic growth eased in the fourth quarter amid slower gains in industrial production, investment and retail sales, suggesting that the recovery is yet to attain a firm footing, data from the National Bureau of Statistics showed Monday. In the whole year of 2013, the GDP grew 7.7 percent, the same pace as in 2012, which was the slowest since 1999.

Light Sweet Crude Oil futures for February delivery, gained $0.62 or 0.7 percent to close at $94.99 a barrel on the New York Mercantile Exchange Tuesday.

Light Sweet Crude Oil futures for March delivery, the most actively traded contract, gained $0.38 or 0.4 percent to close at $94.97 a barrel on the New York Mercantile Exchange Tuesday.

Crude prices for February delivery scaled a high of $95.23 a barrel intraday and a low of $93.43.

The dollar index, which tracks the U.S. unit against six major currencies, traded at 81.14 on Tuesday, down from its previous close of 81.16 late Monday in North American trade. The dollar scaled a high of 81.39 intraday and a low of 81.04.

The euro traded lower against the dollar at $1.3549 on Tuesday, as compared to its previous close of $1.3553 late Monday in North America. The euro scaled a high of $1.3568 intraday and a low of $1.3518.

In economic news from the eurozone, Germany's economic confidence weakened unexpectedly in January, survey data from the Centre for European Economic Research/ZEW showed. The indicator of economic sentiment fell 0.3 points to 61.7 in January. The score was expected to rise to 64.

Elsewhere, China's short-term interest rates declined on Tuesday after the central bank added funds twice this week ahead of Lunar New Year holiday. The People's Bank of China pumped CNY 255 billion via reverse-repurchase agreement today. The bank also offered funds to large commercial banks on Monday, following a sharp rise in money market rates. The actions aim to ensure adequate liquidity and stability in the financial market.