Oil futures slipped back Friday, unable to capitalize on recent gains and following the U.S. equity futures market lower.
Light, sweet crude for October delivery dropped 45 cents, or 0.6 percent, to $88.95 a barrel on the New York Mercantile Exchange. Meanwhile, Brent crude on ICE Futures Europe exchange rose $1.15, or 1 percent, to $113.45 a barrel, amid renewed optimism about the euro zone and North Sea supply disruption. The Brent widened the spread between Nymex and Brent prices.
The decline in crude futures mirrored the drop in stock futures, which slipped 49 points to 11326, amid weak earnings news and pessimism about a consumer sentiment report due out later in the day.
Nymex contracts reached a new 1-month high this week, but have not broken significantly above the $90 range amid mixed economic news, disappointing traders hoping for a stronger bull market. Friday morning volume was light, with 34,750 contracts traded.
"We seem to have recoupled for the time being, at least with WTI (the benchmark West Texas Intermediate crude), with regard to equities and the dollar," said Addison Armstrong, the senior director of market research at Tradition Energy. "That has to do with U.S. equities kind of not being able to make up their mind right now. Overall for oil we've been in this range from at least Tuesday between 90 and a half and 88 on the downside, and I think we'll probably see a session to test those ranges...There hasn't been a lot of bullish follow through after the rally on Monday."
"There are still problems out there and we're seeing the euro giving up some gains," said Ray Carbone, the president of Paramount Options. "My guess is we're in this range for a little bit longer, and then we'll be into season when volume picks up again."
October reformulated gasoline blendstock, or RBOB, recently rose .313 cents, or 1.1%, to $2.8141 a gallon. October heating oil rose .108 cents, or 0.4 percent, to $3.0354 a gallon.