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Prices Rise on Higher Demand for Oil, Slower Wheat Harvest

July 5, 2011 at 22:58 by Vladimir Vyun

Crude oil gained today on improving prospects for growth of China’s and the US economies that may result in higher demand for fuel. The US factory orders increased 0.8 percent in May, following the 0.9 percent drop in April. China’s service industries grew with the second-fastest rate this year. August futures for delivery of crude oil advanced $1.95 to $96.89 per barrel on NYMEX. August contract for Brent oil delivery rose as much as $2.22 (2 percent) to $113.61 per barrel on ICE.

Wheat fell today on forecast that rains will slow harvest in the US. Parts of Nebraska may receive as much as 4 inches of precipitation in the next two days, according to Joel Widenor, the director of agricultural services at the Commodity Weather Group LLC. Some areas of Kansas, the biggest winter-wheat growing state in the US, may get 1.5 inches of rain. The slowdown likely won’t have serious impact on the harvest as the US Department of Agriculture reported that 44 percent of the winter crop was already harvested as of June 26, compared the five-year average of 37 percent. September futures for delivery wheat gained $0.2325 (3.8 percent) to $6.355 per bushel by 13:15 on CBoT.

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