Oil Futures Mixed Ahead of Supply Data
Oil Futures Mixed Ahead of Supply Data
NEW YORK (DTN) -- New York Mercantile Exchange oil futures were mixed Tuesday morning with spot-month ULSD contract lower while West Texas Intermediate crude and RBOB contracts edged higher ahead of weekly oil inventory reports in the United States.
"The market is consolidating…it's marking time before the oil inventory reports, but this is overall positive given that we started this week with the market heavily weighted to the long side, and so you'd expect a selloff," said Phil Flynn at Price Futures. "Heating oil is held back by mild winter weather, so there's expectation for lower fuel demand."
Some weather forecasters said the prospect of a storm over the next ten days in the eastern U.S. has diminished, with the Northeast considered the world's biggest heating oil market.
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NYMEX January WTI crude oil futures gained 34cts to $56.76 bbl at last look, with the December contract having expired on Monday. The January Brent contract added 20cts to $62.42 bbl on the Intercontinental Exchange. The Brent premium to WTI tightened to $5.66 bbl, the narrowest spread in a month.
NYMEX December ULSD futures eased 0.66cts to $1.9255 gallon and December RBOB futures slipped 1.27cts to $1.7320 gallon.
Traders are focused on fundamentals, and a survey this morning shows estimated weekly stock draws of 3.6 million bbl for U.S. crude, 1.75 million bbl for middle distillates and 750,000 for gasoline.
The American Petroleum Institute is set to release its oil statistics for the week-ended Nov. 17 at 4:30 PM ET while the Energy Information Administration will issue its Weekly Petroleum Status Report Wednesday morning.
The market is also keeping an eye on next week's meeting in Vienna of world oil producing nations. Members and 10 nonmembers of the Organization of the Petroleum Exporting Countries will hold talks on Nov. 30 on market conditions. They are also expected to make a decision on extending their production cuts of 1.8 million bpd beyond the March 2018 deadline.
Although Saudi Arabia has proposed a nine-month extension through December 2018 to be announced at the Vienna summit, Russia remains reluctant. The Kremlin has said it wants to wait until near the end of the first quarter 2018 before making that decision.
The Russian stance has prompted doubts and caution in the oil market and that caution has limited the upside for oil futures despite recent data that showed a growing market position for higher oil prices, said analysts.
A stronger dollar also curbed the upside for oil futures, with the U.S. currency rising to a one-week high this morning.
Financial markets will be closed on Thursday for the U.S. Thanksgiving holiday.
(BAS)
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