NYMEX-Crude holds near 16-month highs on Fed stance, better US data
SINGAPORE, July 19 (Reuters) - U.S. crude clung on to overnight gains above $108 a barrel in early Asian trade on Friday after Federal Reserve Chairman Ben Bernanke reassured markets over the timeline for winding down its stimulus program.
Futures were also supported by a drop in weekly jobless claims and a pick-up in factory activity, adding to signs of a stronger U.S. economy.
U.S. crude slipped 4 cents to $108.00 a barrel by 0021 GMT, after settling at a 16-month high of $108.04, up $1.56. Brent gained 15 cents to $108.85, with its premium over U.S. crude touching an intraday low of just 51 cents a barrel on Thursday, the narrowest since August 2010.
- Federal Reserve Chairman Ben Bernanke, speaking before the Senate Banking Committee, reiterated comments he made on Wednesday to the House Financial Services Committee. He stressed that the timeline for winding down the Fed's stimulus program was not set in stone.
- China urged local governments on Thursday to speed up spending this year's budget to support economic growth but said it would keep overall policy stable and focus on pushing through reforms.
- U.S. oil demand fell in June, with consumption dropping to its lowest level for the month in 16 years, industry group American Petroleum Institute said on Thursday.
- Britain has abandoned plans to arm Syrian rebels fighting to overthrow President Bashar al-Assad and believes he might survive in office for years, sources familiar with government thinking say.
- Palestinians put off a decision on Thursday on whether to resume peace talks, with a senior official saying Israel needed to meet their terms before negotiations could resume.
* MARKETS NEWS
- The U.S. dollar was again probing major resistance against the yen on Friday, encouraged by solid economic data, higher Treasury yields and an unthreatening conclusion to testimony from Federal Reserve chief Ben Bernanke.
- The Dow and the S&P 500 closed at record highs on Thursday after Morgan Stanley and others reported better-than-expected earnings and Federal Reserve Chairman Ben Bernanke's comments further reassured markets.
* The following data is expected on Friday:
- 0600 Germany Producer prices
- 0800 Italy Industrial orders
(Reporting by Manash Goswami; Editing by Richard Pullin)