Oil, gas rise on expectations of oil supplies
Energy futures rose as investors anticipated the government will report declines in crude inventories and refinery activity later Wednesday morning.
By Agencies |
NEW YORK: Energy futures rose as investors anticipated the government will report declines in crude inventories and refinery activity later Wednesday morning.
Oil futures' early gains reverse a three-day retreat from record prices that some analysts believe was just a correction in a long-term bull run. Others think prices have peaked and are due to decline by another $10 to $15 a barrel, arguing that the fundamentals of supply and demand don't support $80 oil.
Crude futures nearly reached $84 a barrel on Thursday, the day the October contract expired. November futures, the new front-month contract, haven't traded above $82.40 a barrel, and had fallen for three straight trading sessions, settling below $80 Tuesday.
On Wednesday morning, light, sweet crude for November delivery rose $1.08 to $80.61 a barrel on the New York Mercantile Exchange. October gasoline rose 2.11 cents to $2.059 a gallon on the Nymex.
October heating oil futures rose 2.82 cents to $2.2095 a gallon and Nymex natural gas futures rose 6.2 cents to $6.422 per 1,000 cubic feet.
In London, November Brent crude rose 55 cents to $78.17 a barrel on the ICE Futures exchange.
In its weekly inventory report, the Energy Department's Energy Information Administration is expected to show that crude inventories fell by 1.8 million barrels in the week ended Sept. 21, on average, according to a Dow Jones Newswires survey of analysts. The analysts also predict that refinery utilization fell by 0.6 percentage point to 89 percent of capacity.
Gasoline inventories rose by 200,000 barrels last week, analysts predict, while inventories of distillates, which include heating oil and jet fuel, are forecast to have grown by 1.1 million barrels.
Traders will be keeping a close eye on how the actual numbers, expected at midmorning, compare to these predictions.
``We feel that the market's response to the data will be much more telling or important than the data itself,'' said Jim Ritterbusch, president of Ritterbusch and Associates in Galena, Ill., in a research note.
If the market sells off in the face of bullish news such as a greater-than-expected decline in crude inventories, that would, ``send off a strong signal that a top in crude prices may have been placed, possibly for the balance of this year,'' Ritterbusch said.
However, Ritterbusch and other analysts say they would not be surprised to see oil futures make another run into record territory before beginning an expected seasonal decline next month.
Traders are also keeping an eye on a number of tropical weather systems, but at the moment are not convinced any directly threaten critical oil and gas infrastructure in the Gulf of Mexico.
Oil futures' early gains reverse a three-day retreat from record prices that some analysts believe was just a correction in a long-term bull run. Others think prices have peaked and are due to decline by another $10 to $15 a barrel, arguing that the fundamentals of supply and demand don't support $80 oil.
Crude futures nearly reached $84 a barrel on Thursday, the day the October contract expired. November futures, the new front-month contract, haven't traded above $82.40 a barrel, and had fallen for three straight trading sessions, settling below $80 Tuesday.
On Wednesday morning, light, sweet crude for November delivery rose $1.08 to $80.61 a barrel on the New York Mercantile Exchange. October gasoline rose 2.11 cents to $2.059 a gallon on the Nymex.
October heating oil futures rose 2.82 cents to $2.2095 a gallon and Nymex natural gas futures rose 6.2 cents to $6.422 per 1,000 cubic feet.
In London, November Brent crude rose 55 cents to $78.17 a barrel on the ICE Futures exchange.
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In its weekly inventory report, the Energy Department's Energy Information Administration is expected to show that crude inventories fell by 1.8 million barrels in the week ended Sept. 21, on average, according to a Dow Jones Newswires survey of analysts. The analysts also predict that refinery utilization fell by 0.6 percentage point to 89 percent of capacity.
Gasoline inventories rose by 200,000 barrels last week, analysts predict, while inventories of distillates, which include heating oil and jet fuel, are forecast to have grown by 1.1 million barrels.
Traders will be keeping a close eye on how the actual numbers, expected at midmorning, compare to these predictions.
``We feel that the market's response to the data will be much more telling or important than the data itself,'' said Jim Ritterbusch, president of Ritterbusch and Associates in Galena, Ill., in a research note.
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If the market sells off in the face of bullish news such as a greater-than-expected decline in crude inventories, that would, ``send off a strong signal that a top in crude prices may have been placed, possibly for the balance of this year,'' Ritterbusch said.
However, Ritterbusch and other analysts say they would not be surprised to see oil futures make another run into record territory before beginning an expected seasonal decline next month.
ADVERTISEMENT
Traders are also keeping an eye on a number of tropical weather systems, but at the moment are not convinced any directly threaten critical oil and gas infrastructure in the Gulf of Mexico.
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