Crude-Oil Futures Settle Slightly Higher After EIA Report
Crude-oil futures edged higher Wednesday after the U.S. Energy Information Administration said domestic oil inventories were flat last week and gasoline inventories surged to the highest level for this time of the year in two decades.
Light, sweet crude for August delivery settled 18 cents, or 0.2%, higher at $95.50 a barrel on the New York Mercantile Exchange. ICE North Sea Brent Crude Oil for August delivery settled 40 cents higher at $101.66 a barrel.
Crude-oil inventories in the U.S. were unchanged at 394.1 million barrels for the week ended Friday, the EIA said. Analysts expected U.S. oil inventories to fall by 1.7 million barrels, according to a Dow Jones Newswires survey of analysts.
Oil prices wavered between gains and losses for much of the session. Traders are looking for "some fundamental signals," said Julius Walker, global energy market strategist at UBS in New York. "But the EIA data was not very conclusive."
However, gasoline prices fell following a higher-than-expected build in gasoline stocks during the peak summer-driving season. The high stockpiles in gasoline suggest that demand for crude oil may slump if refineries reduce production.
The EIA reported gasoline stockpiles rose by 3.7 million barrels, while analysts predicted an increase of 660,000 barrels. Gasoline stocks were at the highest for this time of the year since 1992, which pushed gasoline futures to a six-month low before rebounding later in the session.
Front-month July reformulated gasoline blendstock, or RBOB, settled 0.68 cent lower at $2.7306 a gallon.
A strong rise in imports to the East Coast was a key reason for the build. Gasoline imports were 69% higher for the week ended Friday to 937,000 barrels a day.
Analysts said refineries need to manage inventory to correspond with U.S. fuel demand as the focus shifts to fuel efficiency.
"It matters that the physical market is oversupplied," said Tim Evans, energy futures specialist at Citi Futures Perspective. Gasoline stocks in the U.S. were 10% higher on a year-on-year basis, he noted. "Demand is shrinking as we have a major trend in place towards improving automobile fuel efficiency."
Meanwhile, stocks of distillates, comprising heating oil and diesel, increased by 1.6 million barrels, while analysts forecast a 500,000-barrel increase last week.
July ULSD heating oil settled 0.41 cent lower at $2.8543 a gallon.
WHAT DO YOU THINK?
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.