Sep 29, 2010 3:42 PM
Oil prices rose Wednesday after the government reported
inventories fell last week, though supplies remained well above the
Benchmark crude for November delivery gained $1.20 to settle at
$77.86 a barrel on the New York Mercantile Exchange.
Meanwhile, the national average for a gallon of regular gasoline
didn't change much overnight at $2.692, according to a survey by
AAA, Wright Express and the Oil Price Information Service. The
price is almost 3 cents lower than it was a week ago but over 20
cents more than a year ago.
The Energy Department said commercial crude inventories
decreased by 500,000 barrels to 357.9 million barrels, according to
the Energy Information Administration said. The total was about 5.7
percent above year-ago levels.
Gasoline inventories shrank by 3.5 million barrels to 222.6
million barrels, 5.3 percent above year-ago levels. Demand for
gasoline over the four weeks that ended Sept. 24 averaged 9.1
million barrels a day, an increase of nearly 1 percent from the
same period of 2009.
Inventories of distillate fuel, which include diesel and heating
oil, fell by 1.3 million barrels to 173.6 million barrels, which
was 1.5 percent above year-ago levels, the government reported.
"The face value of the report looks price supportive. However,
even after these draws, we still have huge supply surpluses
anywhere you look," said oil analyst Jim Rittersbusch, president
of Ritterbusch and Associates. "Everybody's yawning again, and
going back and watching to see what the stock market does."
The oil market has remained stable, with September prices
ranging between $73 a barrel and $78 a barrel. It's a trend
analysts expect to continue as traders wait for signs of an
improving economy and stronger demand that would tap into supplies.
Traders have been watching stock markets for clues about the
recovery in the months ahead. The Dow Jones Industrial Average was
off about 40 points in afternoon trading. The S&P 500 and the
NASDAQ were also lower after worries about Europe resurfaced
following protests in Brussels, Spain and Ireland over austerity
measures aimed at preventing another fiscal crisis.
In other Nymex trading in October contracts, heating oil rose
6.60 cents to settle at $2.1905 a gallon and gasoline gained 4.76
cents to settle at $1.9765 a gallon. Analysts expect both contracts
to be active since they expire Thursday. Natural gas for November
delivery added 1.1 cents to settle at $3.962 per 1,000 cubic feet.
In London, Brent crude rose $2.06 to settle at $80.77 a barrel
on the ICE Futures exchange.