Wed Jun 2 09:35 ET
NYMEX Oil Pre-Opg: Higher; trimming Tues loss ahead of APIs
OPENING CALL: Crude oil futures: Up 5-10 cents per barrel
Heating oil: Up 25-50 points per gallon
Gasoline: Up 25-50 points per gallon
By Mary Chung, Bridge News
New York--Jun 2--NYMEX crude and product futures are seen higher in
technical retracement after Tuesday's tumble in prices. However, several brokers
and traders said today's bounce is only a pause in a market correction, which
could push crude prices below $16.00, a 2-month low. The market is also focusing
on American Petroleum Institute data, which are expected to show a rise in US
crude stockpiles last week.
* * *
"We had a little price exhaustion on the downside. This is a short-term
bounce," one broker said following firmer overnight trade.
NYMEX Jly crude ended the Access session down 9c at $16.43. Jly heating oil
ended up 17 points at 39.30c, while Jly gasoline ended up 38c at 47.75c.
Jly crude is expected to trade inside Tuesday's range between $16.20-$16.60,
some brokers and traders said.
Gasoline is expected to lead the push up following news of refinery
shutdowns at Chevron's 70,000-barrel-per-day fluid catalytic cracking unit at
its Richmond, Calif. refinery and at Chevron's El Segundo, Calif., refinery's
45,000 bpd hydrocracker.
"The El Segundo shutdown is a little supportive. It rippled through the
gasoline cast market and ultimately it affects (NYMEX)," a broker said.
But most brokers and traders predict that the "market hasn't hit bottom in
this corrective mode."
"We're close to putting on a bottom but we need one more set of lows," one
broker said.
The market will be focusing on API data released this afternoon, which are
expected to show that crude inventories increased 1.5-2.5 million barrels last
week, according to most brokers and analysts.
Stockpiles of gasoline are expected to have dropped 0.5-1.5 million barrels
last week, while distillates--which include heating oil and diesel fuel--are
anticipated to have increased 0.5-1.5 million barrels. Refinery runs are
expected to have been unchanged of slightly dropped 0.5 percentage points.
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