Updated Wed May 17 09:09 ET
NYMEX Oil Pre-Opg: Lower amid mixed API, DOE crude stock data
OPENING CALL: Crude oil futures: Down 25-30 cents per barrel
Heating oil: Unchanged to up 25 points per gallon
Gasoline: Down 25-50 points per gallon
By Peter Rosenthal, BridgeNews
New York--May 17--NYMEX crude oil futures are expected to move lower
Wednesday amid mixed reports on crude stocks from both the American Petroleum
Institute and the U.S. Department of Energy. API reported that crude stocks fell
last week, while the DOE showed a modest increase. Traders are also said to be
taking profits after Jun crude failed to close above the key $30.00 mark.
* * *
"We failed at $30.00, the question is can this lower call hold up," a broker
said.
The latest inventory data from the American Petroleum Institute shows crude
stocks fell 2.2 million barrels last week and inventories of distillate fuel
decreased 656,000 barrels. Inventories of gasoline rose 629,000 barrels. (Story
.1898)
East Coast stocks of reformulated gasoline--the basis for NYMEX futures
contracts, which are deliverable at the New York harbor--rose 596,000 barrels
last week, which may ease some concerns about an impending summer shortage.
However, the Department of Energy reported Wednesday that crude and gasoline
stocks increased, in line with market expectations.
Jun crude has initial support at $29.60, then at $29.40 and $29.00.
Refinery operations increased 1.3 basis points last week to 93.8% of
capacity as domestic oil companies boost output ahead of the busy summer driving
season. With profit margins continuing to widen, those plants should continue to
step up production. East Coast cash margins, for instance, rose to $9.38 per
barrel Tuesday, from $8.78 the prior day, according to a BridgeNews
calculation.
A narrowing premium for June crude to July is also adding pressure to the
market, although the spread on London's IPE was much wider when Jun Brent
expired on Tuesday.
"I don't see a big selloff, today should be a consolidating day," a broker
said. "At this point it's a little bit more technical than anything else."
Direction may also be related to the expiration of Jun options contracts.
As of the end of trading Monday, the last day for which data are available,
there were 11,283 lots on $29.00 calls, by far the largest amount on either
calls or puts near the current price. There were 5,945 lots on $29.00 puts.
Resistance is expected again at $30.00.
NYMEX Jun crude ended the overnight Access session down 31c at $29.42 a
barrel. Jun heating oil fell 34 points to 76.50c a gallon, while Jun gasoline
ended down 31 points at 98.00c. At 0846 ET, IPE Jul Brent was down 26c at
$27.84. End
UPCOMING:
--NYMEX Jun crude futures expire Monday; Jun crude options today. Jun product
futures expire May 31, Jun product options May 25. IPE Jul Brent crude futures
expire June 15; Jul crude options expire June 12.
--Commodity Futures Trading Commission commitment of traders data for the two
weeks ended Tuesday are due out after 1530 ET Friday.
IN THE NEWS
Story
Number Headline
------ --------
.14702 BP Amoco to restart UK Grangemouth oil refinery unit next week
.12361 Iran, Kuwait, Qatar to meet full June term crude supply to Japan
.25943 Formosa to start 730,000-bpd RFCC end June on construction delay
.24378 Local trader said cause of Klein's losses on NYBOT
.1898 API Review: Crude, distillate stockpile declines supportive
.22383 Planning for Venezuela OPEC leaders' summit seen in chaos
.14109 Saudis increasing crude volumes to Europe by few percent in June |
