Commodity Corner: Oil Gets Boost from Gasoline Data
November crude oil futures benefited Wednesday from an unexpected decline in U.S. gasoline inventories last week, along with a weaker dollar.
Oil settled at $83.23 a barrel, a 41-cent improvement from Tuesday, after the U.S. Department of Energy announced that total gasoline stocks declined to 219.9 million barrels as of October 1. The latest figure represents a 1.2% decline from the previous week. The euro, meanwhile, gained 0.723% against the dollar to an exchange rate of US$1.3936 Wednesday. Since September 8, the euro has rallied nearly 9% against the greenback. A weaker dollar relative to the euro typically places upward pressure on oil prices.
The crude oil futures price peaked at $84.09 and bottomed out at $82.29.
Given the Energy Department's report on the refined product, gasoline for November delivery also ended the day higher Wednesday. Gasoline rose three cents to settle at $2.16 a gallon after trading from $2.11 to $2.165.
Colder temperatures are not expected to set in until later in the season--a prediction that has not been lost on natural gas traders lately as prices have been low in recent weeks. Nevertheless, gas futures settled at $3.865 per thousand cubic feet Wednesday--a 3.3% increase from the previous day. The bullish sentiment for gas stems from speculation that the Energy Information Administration would announce a decline in natural gas inventories in a weekly report Thursday.
The front-month price for natural gas fluctuated from $3.75 to $3.88.