Crude-oil futures climbed past $77 a barrel, then pared some of their gains after U.S. government data showed that gasoline supplies have been falling since early August and crude inventories were down a second week, but refinery activity climbed.
“Though prices pulled back sharply on the initial release of the data, the undercurrent of support in the energy markets continues to be the supply issue,” said Neal Ryan, a manager and market analyst at Ryan Oil & Gas Partners LLC. “Supply concerns will be the support under the market, but the potential for escalating violence in the Middle East, hurricane activity in the Gulf of Mexico and other assorted disruptions in more volatile areas of the world will be the catalyst for a break out,” he said in emailed comments.
Crude oil for October delivery was last up 57 cents, or 0.8%, at $76.30 a barrel on the New York Mercantile Exchange. The contract had touched $77.23 ahead of the supply data’s release. That was the strongest intraday level since Aug. 1. On Wednesday, it climbed 65 cents. The intraday record for a front-month futures contract trading in a regular session stands at $78.70, which was also reached on Aug. 1.
Crude supplies dropped by a bigger-than-expected 3.9 million barrels to 329.7 million during the week ended Aug. 31, the Energy Department reported Thursday. The data came out a day late due to Monday’s Labor Day holiday.
Motor gasoline supplies also fell by 1.5 million barrels in the latest week to a total of 191.1 million, the Energy Department reported. Inventories are 8.8% below the year-ago level, the data showed. Distillate inventories were up a bit more than the market had expected. They climbed 2.3 million to 132.2 million, according to the Energy Department. They were up 3.3 million at 132 million, according to the API.
Refinery utilization climbed in the latest week to 92.1% of capacity from 90.3% a week earlier, the Energy Department report showed.
“The draw in crude was very telling, but the bigger build in distillate and refining capacity helped offset it,” said Kevin Kerr, editor of Global Resources Trader, a newsletter of MarketWatch.
“Though prices pulled back sharply on the initial release of the data, the undercurrent of support in the energy markets continues to be the supply issue,” said Neal Ryan, a manager and market analyst at Ryan Oil & Gas Partners LLC. “Supply concerns will be the support under the market, but the potential for escalating violence in the Middle East, hurricane activity in the Gulf of Mexico and other assorted disruptions in more volatile areas of the world will be the catalyst for a break out,” he said in emailed comments.
Crude oil for October delivery was last up 57 cents, or 0.8%, at $76.30 a barrel on the New York Mercantile Exchange. The contract had touched $77.23 ahead of the supply data’s release. That was the strongest intraday level since Aug. 1. On Wednesday, it climbed 65 cents. The intraday record for a front-month futures contract trading in a regular session stands at $78.70, which was also reached on Aug. 1.
Crude supplies dropped by a bigger-than-expected 3.9 million barrels to 329.7 million during the week ended Aug. 31, the Energy Department reported Thursday. The data came out a day late due to Monday’s Labor Day holiday.
Motor gasoline supplies also fell by 1.5 million barrels in the latest week to a total of 191.1 million, the Energy Department reported. Inventories are 8.8% below the year-ago level, the data showed. Distillate inventories were up a bit more than the market had expected. They climbed 2.3 million to 132.2 million, according to the Energy Department. They were up 3.3 million at 132 million, according to the API.
Refinery utilization climbed in the latest week to 92.1% of capacity from 90.3% a week earlier, the Energy Department report showed.
“The draw in crude was very telling, but the bigger build in distillate and refining capacity helped offset it,” said Kevin Kerr, editor of Global Resources Trader, a newsletter of MarketWatch.
Via: Wall Street Journal / Mark Gongloff
by Myra P. Saefong
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