Inventories news sends oil higher

Elaine Frei | | 0 Comments

Crude oil, gasoline, and distillate prices were up on Wednesday after the release of the weekly US inventories figures. While crude oil inventories were up by 2.1 million barrels in the week ending March 31, well above the forecast rise of 1.1 million barrels, gasoline stockpiles were down by 4.4 million barrels against a predicted decline of just 1.6 million barrels. Distillates inventories, also expected to be down by 1.6 million barrels, actually fell by a much larger 2.6 million barrels.

Prices on West Texas Intermediate crude for May delivery added 38 cents to $66.61 per barrel on the New York Mercantile Exchange, while Brent crude May contracts were up 47 cents to $66.86 per barrel on the International Petroleum Exchange.

Nymex unleaded gasoline prices for May added 5.4 cents to $1.95 per gallon. US refineries operated at only 95.9 percent of capacity last week, producing around 8.1 million barrels of gasoline per day, and traders feared that they would not be able to cope with increased summer demand. Meanwhile, May Nymex heating oil added 1.7 cents to $1.8730 per gallon.

Elsewhere in commodities, predictions of growth in demand from India’s mines ministry helped send copper and zinc prices to new record high prices on Wednesday. The ministry said that India’s copper consumption will maintain its present consumption growth of 7 to 8 percent for the next two years. The Asian nation’s zinc production was forecast to grow by 13.6 percent this year.

Three-month copper was up 2.3 percent to $5,677 per tonne and rose as high as a record $5,684 per tonne earlier in the day. An analyst report, however, said that liquidity was a problem in the market as prices have been rising steadily on very low volume from very few buyers.

Zinc hit a record price of $2,800 per tonne during the day and settled at an advance of 3.8 percent to $2,790 per tonne. Meanwhile, three-month lead dropped 0.6 percent to $1,152 per tonne.

Gold was slightly higher at $586.90 per troy ounce as traders said that continued weakness in the dollar could send its price above $600 per troy ounce. Silver was also slightly higher at $11.70 per troy ounce.

Platinum and palladium dropped slightly. Platinum traded at $1,067 per troy ounce, while palladium was at $334 per troy ounce.