NYMEX Oil Review: Crude, gasoline gain as traders seek bargains
By Peter Rosenthal, BridgeNews
New York--April 27--NYMEX crude oil futures rallied Thursday as commodity
investment funds and local traders sought to scoop up bargains after 2 days of
losses, brokers said. News of a likely reduction in gasoline shipments from
Venezuela helped boost May gasoline, which settled up 209 points at 82.38c a
gallon. Jun crude settled up 77 cents at $25.42 a barrel.
* * *
May heating oil fell 81 points to 75.05c. May products go off the board
Friday and brokers said participants were selling May heating oil and buying
gasoline, unwinding positions accumulated earlier in the month.
Venezuela's state-owned oil company Petroleos de Venezuela S.A. (PDVSA) will
not be able to ship as much reformulated gasoline to US markets this year due to
delays overhauling the only major reformer in PDVSA's domestic refining system
and other maintenance holdups.
After slashing maintenance outlays in 1998 to cope with low cash flow,
PDVSA now faces a series of urgent turnaround projects, a company source told
BridgeNews.
Concern about production at US Gulf refineries also continued to percolate
after two ExxonMobil plants suffered unplanned shutdowns earlier in the week.
Crude was also boosted by strength in Brent trading that may have been
linked to problems restarting full production at a North Sea field. Norwegian
oil company Norsk Hydro on Thursday said its Snorre oil field in the No
rth Sea is now pumping almost 100,000 bpd after production resumed Tuesday,
two-thirds of capacity.
OUTLOOK:
Trading Friday will be driven by May products expiration, although gasoline
and heating oil continue to diverge. While gasoline rose, participants appear
more concerned about actual supply of heating oil.
"People we talk to say there's not a lot of product out there," said a
broker. Cash prices for heating oil and diesel in the New York harbor, the
delivery point for NYMEX contracts, remained at a premium to futures, although
buyers were absent Thursday.
Prices for NYMEX-deliverable reformulated gasoline in the harbor are under
May by 1-to-2c.
Jun crude will seek resistance at $25.50, with support just under $25.00.
Traders are watching for further indications of how much crude OPEC produced in
June, with more complete surveys expected early next week. End
UPCOMING:
--NYMEX Jun crude futures expire May 22; Jun crude options May 17. May product
futures expire Friday. IPE Jun Brent crude futures expire May 16; Jun Brent
options May 11.
--NYMEX Energy Week is next week in New York. |
