Oil rose to its highest price in a week in New York after gasoline stockpiles declined more than forecast in the U.S., the world’s biggest user of the fuel.

Futures climbed as much as 0.7 percent. U.S. gasoline inventories fell 4.3 million barrels, the Energy Department said yesterday. Supplies were projected to drop 1.38 million barrels in a Bloomberg News survey. The decrease countered figures that showed imports and demand for the motor fuel fell. Oil markets are better-supplied for the first time since 2009, the International Energy Agency said today.

“There is demand out there,” Robert Montefusco, senior broker at Sucden Financial Ltd. in London, said in an interview with Maryam Nemazee on Bloomberg Television. The economic outlook “is improving but we’re getting contradictory signals.”

Crude for May delivery on the New York Mercantile Exchange rose as much as 67 cents to $103.37, the highest price since April 5, and was at $103.16 a barrel at 1:05 p.m. London time. Prices are up 4.4 percent this year.

Brent oil for May settlement slipped 19 cents to $119.99 a barrel on the London-based ICE Futures Europe exchange. The European benchmark contract’s premium to New York-traded West Texas Intermediate narrowed to $16.84 from $17.48 yesterday.

Gasoline Demand

Refinery utilization fell 1.9 percentage points to 83.8 percent of capacity last week, according to the Energy Department. That’s the biggest drop since the period ended Feb. 24. Motor-gasoline products supplied, a proxy for demand, shrank 102,000 barrels a day and imports slid 180,000 barrels a day.

Prices at the pump may have peaked for the year. Regular gasoline, averaged nationwide, declined for a fifth day to $3.915 a gallon on April 10 after surging 20 percent and reaching $3.936 on April 4, according to data from AAA, the biggest U.S. motoring club. Americans have purchased 5.3 percent less gasoline so far this year than in 2011, data from credit- card receipts analyzed by MasterCard Inc. (MA) (MA)’s SpendingPulse showed on April 10.

U.S. distillate inventories, a category that includes diesel and heating oil, declined 4 million barrels, the Energy Department report showed. They were forecast to slip 250,000 barrels, according to the median estimate of 10 analysts in the Bloomberg survey. Crude stockpiles rose 2.8 million barrels compared with a projected increase of 2 million.

Sluggish Demand

Oil markets are better-supplied as “sluggish” demand and OPEC output at more than a three-year peak eased inventory depletion, the Paris-based IEA said in its monthly Oil Market Report today. Global oil inventories may have increased by more than 1 million barrels in the first quarter.

“The cycle of repeatedly tightening fundamentals evident since 2009 has been broken for now,” said the IEA, which advises 28 nations on energy policy. “The earlier tide of remorseless market tightening looks to have turned.”

Oil prices have gained this year on concern that tension with Iran will disrupt global supplies. France remains “open” to the possibility of a release of crude stockpiles by IEA member countries to keep prices in check, Industry Minister Eric Besson said yesterday.

Crude’s advance in New York created a so-called bullish engulfing pattern on the candlestick chart, signaling increased buying, according to data compiled by Bloomberg. Futures also settled above the 100-day moving average, which represents technical support today at $101.63 a barrel.

Natural gas futures in New York closed below $2 per million British thermal units yesterday for the first time in a decade on a growing supply glut caused by mild weather and record production. Prices for May delivery slid 2.3 percent to $1.984 per million British thermal units on the Nymex yesterday, the lowest settlement price since Jan. 28, 2002. They fell as low as $1.976 today.
Source: Business Week

DiscoverWeyburn.com is Weyburn's only source for community news and information such as weather and classifieds.