“We’re seeing strong demand for gasoline, diesel and jet fuel in the US Even through crude supplies are high, there seems to be a little bit of a shift in sentiment”.
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Oil prices held close to unchanged Thursday as fears of lingering oversupply capped a rally from technical traders, brokers said.
Crude markets pared earlier gains in the session as disappointing United States economic data curbed investor enthusiasm after Wednesday’s 6% price spike.
Crude stocks at the Cushing delivery hub fell by 748,000 barrels, data from the industry group, the American Petroleum Institute, showed late on Tuesday.
Data showed that USA economic growth slowed sharply in the third quarter as businesses cut back on restocking while contracts to buy previously owned United States homes fell unexpectedly in September.
The global benchmark for oil, Brent North Sea crude for December delivery, fell to $US48.80 a barrel, a 25-cent drop from Wednesday’s settlement.
In London trading, Brent crude rallied nearly 4% to US$48.70 a barrel and West Texas Intermediary futures added 4.6% to US$45.32 a barrel.
In addition, the Federal Reserve gave an improved view of the USA economy and clearly put December on the table for a possible interest rate hike. Jet fuel product supplied is up 1.9% compared to the same four-week period past year. This is expected to weigh on the minds of Fed officials.
The US Energy Information Administration said the nation’s crude stockpile grew by 3.4 million barrels in the week that ended Oct 23, a smaller than forecast increase.
“OPEC production is the other major issue in our view, and it looks like Iraqi production continues above 4.0 million barrels per day, as part of that total”, Evans said.
“In the mid term, we will be still driven by the global oil glut worries”. “The crude stock story might gain further momentum as despite a year-on-year fall of just over 1,000 rigs in the Baker Hughes oil rig count, we would caution that the widely expected fall in United States crude oil production could be significantly lower than many are expecting”, JBC Energy consultancy said in a note.
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RBOB gasoline futures lost 0.006 dollar or 0.441 percent to trade at USD 1.333 a gallon at the NYMEX.
