Investing.com - Crude oil futures swung between gains and losses in choppy trade on Tuesday, as traders monitored the direction of the dollar to gauge the appeal of dollar-denominated commodities.
On the New York Mercantile Exchange, crude oil for delivery in May tacked on 21 cents, or 0.44%, to trade at $47.66 a barrel during U.S. morning hours. Prices traded in a range between $46.67 and $48.55.
Elsewhere, on the ICE Futures Exchange in London, Brent oil for May delivery shed 48 cents, or 0.87%, to trade at $55.44 a barrel.
Meanwhile, the spread between the Brent and the WTI crude contracts stood at $7.78 a barrel, compared to $8.47 by close of trade on Monday.
The U.S. dollar index, which measures the greenback’s strength against a trade-weighted basket of six major currencies, was up 0.35% to 97.55 on Tuesday.
The greenback strengthened after official figures on Tuesday showed that U.S. consumer prices rose 0.2% in February, in line with market expectations, rebounding after a 0.7% decline in January.
On a year-over-year basis the U.S. consumer price index was flat after slipping 0.2% in January.
The report showed that gasoline prices rose 2.4%, the largest increase since December 2013, snapping seven months of declines.
Core inflation, which excludes food and energy costs ticked up 0.2% in February after a similar gain in January. Core inflation was up 1.7% from the same month last year, the largest increase since November.
Separate reports showed that sales of new homes in the U.S. surged to the highest level in seven years in February, while manufacturing activity expanded at the fastest pace in five months in March.
New home sales jumped 7.8% to an annual unit rate of 539,000 last month, the highest level since February 2008 the Commerce Department said.
The preliminary reading of the U.S. manufacturing purchasing managers' index rose to 55.3 this month, the highest level since October, from 55.1 in February.
Meanwhile, in the euro zone, data showed that the region's economic recovery gathered further momentum, adding to signs that the European Central Bank’s quantitative easing is stimulating the real economy.
The euro area composite PMI, which measures activity in the manufacturing and services sectors, rose to 46-month high of 54.1 in March from 53.3 in February.
Elsewhere, in China, the preliminary reading of China’s HSBC (LONDON:HSBA) manufacturing index dropped to an 11-month low of 49.2 in March, below the 50-point level that separates growth in activity from contraction. Analysts had expected a reading of 50.6, down slightly from February's reading of 50.7.
The disappointing data fuelled speculation policymakers in Beijing will have to introduce further stimulus measures to boost growth and spur economic activity in the world's second largest economy.
Market participants looked ahead to fresh weekly information on U.S. stockpiles of crude and refined products to gauge the strength of demand in the world’s largest oil consumer.
The American Petroleum Institute will release its inventories report later in the day, while Wednesday’s government report could show crude stockpiles rose by 3.8 million barrels in the week ended March 20.
Total U.S. crude oil inventories stood at 458.5 million barrels as of last week, the most in at least 80 years, underling concerns over a supply glut.