Oil Rises On Gasoline Supply Dip
Oil prices rose Wednesday after a government report revealed a bigger-than-expected increase in crude stockpiles but a bigger-than-expected drop in inventories of gasoline and distillates used for heating oil.
U.S. light sweet crude for May delivery gained 84 cents to $67.07 a barrel after the Energy Information Administration (EIA) released its report.
Crude oil inventories rose by 2.1 million barrels for the week ended March 31, the government said, versus forecasts for a rise of 1.1 million barrels, according to a survey of analysts conducted by Reuters.
Crude oil inventories remain well above the upper end of the average range for this time of year, and are at the highest level since the week ending April 9, 1999.
"Refinery utilization was lower than everyone expected, which caused (gas and distillate) inventories to drop," Brian Kuzma, energy analyst at RBC told CNNMoney.com.
But Kuzma said he didn't expect the report to "have much impact on the future impact on crude or related products."
Several oil refineries are still not fully operational due to damage from last year's hurricanes, but other refineries are expected to be down for maintenance in April after running full throttle longer than normal to make up for petroleum product output disrupted by hurricanes Katrina and Rita.
These shutdowns are expected to dip into gasoline inventories as motor fuel demand picks up during the busy driving season.
"With gasoline inventories typically increasing by about 3 million barrels in April, a significant draw this month could represent a dramatic drop compared to average levels," the EIA said in its weekly review of the oil market.
Gasoline inventories fell by 4.4 million barrels last week, and are just above the upper end of the average range. Gasoline inventories were expected to fall by 1.6 million barrels, according to a Reuters survey.
U.S. gasoline stocks have declined for five weeks in a row, shrinking 14.1 million barrels during the period.
Falling gasoline inventories put upward pressure on pump prices, which soared 9 cents over the last week to a national average of $2.59 a gallon, the agency said.
The EIA said if the hurricane-damaged refineries come back online fully this month, then gasoline inventories might not be drawn down as much.
Inventories of distillate fuel used for heating fell 2.6 million barrels last week, but remain well above the upper end of the average range for this time of year. Reuters reported that distillates were expected by analysts to drop by 1.6 million barrels.
CNN
U.S. light sweet crude for May delivery gained 84 cents to $67.07 a barrel after the Energy Information Administration (EIA) released its report.
Crude oil inventories rose by 2.1 million barrels for the week ended March 31, the government said, versus forecasts for a rise of 1.1 million barrels, according to a survey of analysts conducted by Reuters.
Crude oil inventories remain well above the upper end of the average range for this time of year, and are at the highest level since the week ending April 9, 1999.
"Refinery utilization was lower than everyone expected, which caused (gas and distillate) inventories to drop," Brian Kuzma, energy analyst at RBC told CNNMoney.com.
But Kuzma said he didn't expect the report to "have much impact on the future impact on crude or related products."
Several oil refineries are still not fully operational due to damage from last year's hurricanes, but other refineries are expected to be down for maintenance in April after running full throttle longer than normal to make up for petroleum product output disrupted by hurricanes Katrina and Rita.
These shutdowns are expected to dip into gasoline inventories as motor fuel demand picks up during the busy driving season.
"With gasoline inventories typically increasing by about 3 million barrels in April, a significant draw this month could represent a dramatic drop compared to average levels," the EIA said in its weekly review of the oil market.
Gasoline inventories fell by 4.4 million barrels last week, and are just above the upper end of the average range. Gasoline inventories were expected to fall by 1.6 million barrels, according to a Reuters survey.
U.S. gasoline stocks have declined for five weeks in a row, shrinking 14.1 million barrels during the period.
Falling gasoline inventories put upward pressure on pump prices, which soared 9 cents over the last week to a national average of $2.59 a gallon, the agency said.
The EIA said if the hurricane-damaged refineries come back online fully this month, then gasoline inventories might not be drawn down as much.
Inventories of distillate fuel used for heating fell 2.6 million barrels last week, but remain well above the upper end of the average range for this time of year. Reuters reported that distillates were expected by analysts to drop by 1.6 million barrels.
CNN
posted by Ottawa Gas Prices | 7:47 PM
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