Wednesday, July 18, 2007

Oil Back Above $75

Oil Goes Back Above $75

Oil futures bounced higher on Wednesday after a bullish inventory report released by the Energy Information Administration caught analysts and traders by surprise.
August light sweet crude was up $1.12 at $75.07 a barrel on the New York Mercantile Exchange. Reformulated gasoline jumped 8 cents to $2.19 a gallon, and heating oil climbed 6 cents to $2.09 a gallon.

Natural gas advanced 17 cents, or 2.6%, to $6.47 per million British thermal units.

Energy futures markets were calm until the EIA released its weekly storage report. The figures show that crude inventories declined by 500,000 barrels during the week ended July 13, while analysts were expecting a 450,000-barrel decline.

Gasoline stores plummeted by 2.2 million barrels. Analysts were looking for an 850,000-barrel increase. Distillate inventories grew by 145,000 barrels, well short of the 900,000-barrel injection that had been foreseen.

Refinery utilization increased 0.8 percentage points to 91% during the week.

"Although there was a slight increase in refinery utilization, the drop in gasoline inventories caught many in the market off guard," says Thomas Hartmann, analyst at Altavest Worldwide Trading.

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