Finance & Investing
News Services
Newsletters
Get free industry updates via email.
Daily News
Weekly News
Equipment Updates
Weekly Job Register
Monthly Event Guide
Our privacy
pledge.


advertisement

Gasoline's 2.1% Fall Spurs Profit-Taking in Crude

change text size

U.S. crude oil prices fell 0.2% Friday as a selloff in gasoline markets sparked some profit-taking among oil traders heading into the weekend.

Light, sweet crude for November delivery settled at $91.86 a barrel, down 21 cents but finished the week with a 2.2% gain on the New York Mercantile Exchange. The overall increase in the week's price snapped a three-week losing streak in the West Texas Intermediate crude market. Brent crude on ICE Futures Europe, the overseas crude benchmark, settled at $114.62, down 0.9% for the day but up 2.3% for the week.

WTI traders shrugged off the International Energy Agency's forecasts that oil production capacity would outstrip demand by 6.3 million barrels a day in 2017. Traders said they had already heard in other reports that demand was weakening, so while the IEA's numbers were new, the general trend wasn't.

Around midday, crude futures reached their intraday lows, tracking losses in reformulated blendstock for oxygenated blending, or RBOB, spurred by expectations that some East Coast refineries would restart production after maintenance shutdowns. The RBOB contract for November delivery settled 2.1% lower at $2.8928 a gallon Friday.

That drop led to some profit-taking throughout the energy complex, said Andy Lebow, broker at Jefferies & Co.

"Weakness in the gasoline market is spilling over to WTI," Mr. Lebow said. "Markets that were way overcooked--boiling, really--are now just cooling down."

Delta Airlines was said to be restarting the 185,000 barrel-a-day refinery in Trainer, Pa., that it bought earlier this year from ConocoPhillips (COP). Motiva Enterprises Plc., a joint venture between Royal Dutch Shell Plc. (RDSA) and Saudi Arabia Oil Co., is also expected to restart its 325,000 barrel-a-day refinery expansion in Port Arthur, Texas, within the next two months.

Worries that the tensions between Turkey and Syria could escalate during the weekend and threaten oil supplies kept crude prices from falling further, traders said.

But oil prices could resume their slide next week if no major fighting occurs, said Mark Waggoner, president of Excel Futures. Even as some East Coast refineries restart, overall production will drop as winter sets in and U.S. drivers spend less time on the road.

"Everyone is still looking at what's going on in Syria and Turkey, but I think [prices are] ultimately going to break down next week," Mr. Waggoner said. "Demand isn't that great and refineries are cutting back."

Nymex heating oil prices fell 3.32 cents a gallon Friday to settle at $3.2239.

Copyright (c) 2012 Dow Jones & Company, Inc.

WHAT DO YOU THINK?

Post a Comment Generated by readers, the comments included herein do not reflect the views and opinions of Rigzone. All comments are subject to editorial review. Off-topic, inappropriate or insulting comments will be removed.


Most Popular Articles
From the Career Center
Jobs that may interest you
Project Interface Manager
Expertise: Operations Manager, Project Management, Risk Management
Location: TX
 
Permian area Rathole Sales
Expertise: Sales and Marketing
Location: Midland, TX
 
Sales Representative - South Texas
Expertise: Fishing, Sales and Marketing
Location: Victoria, TX
 
search for more jobs