Oil Futures Gain on Weekly Supply Data
Oil Futures Gain on Weekly Supply Data
NEW YORK (DTN) -- New York Mercantile Exchange oil futures gained Wednesday on the back of bullish weekly crude supply data from the American Petroleum Institute and renewed hope the Organization of Petroleum Exporting Countries and non-OPEC members would freeze production at January levels despite recent statements to the contrary by Saudi Arabia.
Also, technical futures indicators for West Texas Intermediate crude and ULSD moved into oversold territory following the recent downside correction while RBOB's minor trend remains down.
At 9:00 AM ET, NYMEX May WTI crude oil futures were up 0.78cts or 2.2% at $36.67 bbl, off a two-day high at $37.15. With daily stochastics at the oversold level of 20%, the contract is consolidating near its $35.85 support, said DTN senior analyst Darin Newsom.
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IntercontinentalExchange June Brent futures advanced 62cts to $38.49 bbl, trading near a two-day high of $38.86 bbl. Brent has found support near $37.40, setting the stage for a potential bullish crossover by daily stochastics below the oversold level of 20%.
In products trade, NYMEX May ULSD futures gained 1.64cts to $1.0910 gallon, off a two-day high of $1.1011, while May RBOB futures edged up 0.07cts to $1.3785 gallon, off a $1.3927 gallon two-day high.
The U.S. dollar, which has an inverse relationship with WTI futures, moved mixed in index trading, holding above last week's 5-1/2 month low. The choppy price action comes ahead of the afternoon release of minutes of last month's Federal Reserve meeting.
Late Tuesday, the API showed a 4.32 million bbl drawdown in domestic crude oil stockpiles versus market expectations for a 3.0 million bbl build. API also reported gasoline stocks were drawn down 116,000 bbl that fell short of an expected draw of 1.5 million bbl. Distillate stocks rose by 2.68 million bbl while the market expected a 300,000 bbl drawdown.
The U.S. Energy Information Administration is scheduled to release its weekly oil data at 10:30 AM ET.
Recent doubts on whether OPEC and non-OPEC oil producers would agree to freeze output were assuaged after Kuwait said on Tuesday that a deal will likely be reached even without Iran at a scheduled April 17 meeting.
The Saudis last week said they would only freeze their output if Iran follows suit. Iran, which won sanctions relief in January, has rejected freezing its output until returning to its pre-sanctions supply level.
(BAS)
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