Oil futures rose early Monday, attempting to build on last week’s bounce, as worries around the U.S. banking sector eased.
Price action
-
West Texas Intermediate crude for May delivery
CL00,
+1.88% CLK23,
+1.88%
rose 70 cents, or 1%, to $69.96 a barrel on the New York Mercantile Exchange. -
May Brent crude
BRN00,
+1.72% BRNK23,
+1.64% ,
the global benchmark, gained 80 cents, or 1.1%, to $75.39 a barrel on ICE Futures Europe. -
Back on Nymex, April gasoline
RBJ23,
+1.00%
was up 0.1% at $2.59 a gallon, while April heating oil
HOJ23,
+1.08%
fell 0.1% to $2.693 a gallon. -
April natural gas
NGJ23,
-4.60%
slid 4% to $2.128 per million British thermal units.
Market drivers
Markets, including crude, were showing signs of relief after the weekend brought no adverse developments on the global banking front.
First Citizens BancShares Inc.
FCNCA,
entered a deal to assume all the deposits and loans of the failed Silicon Valley Bridge Bank from the Federal Deposit Insurance Corp., the regulator announced on Monday. Bloomberg reported that U.S. authorities were considering an expansion of an emergency lending facility that would allow more time for troubled First Republic Bank
FRC,
to shore up its balance sheet. Share of U.S. banks rose in premarket trade.
Fears banking troubles could turn into a full-fledged crisis were blamed for sinking crude prices to 15-month lows earlier this month. Analysts said investors remain wary that a credit crunch could result as a result of trouble in the banking sector.
“Bank worries and recession fears are dominating price action in energy, and unless we get positive news out of the banking sector or some solution for the Fed to pull off a soft landing, risks in oil prices will remain skewed to the downside,” wrote analysts at Sevens Report Research, in a Monday note.
