Oil Futures Mixed in Midday Trade

Brian L Milne
By  Brian L. Milne , DTN Refined Fuels Editor

CRANBURY, N.J. (DTN) -- Oil futures nearest delivery on the New York Mercantile Exchange pressed to session lows in the immediate response to the midmorning release of weekly supply data from the Energy Information Administration, with the ULSD contract sliding to $1.8401, a new 8-1/2 month low.

Builds in commercial crude and distillate stocks alongside a steep decline in implied distillate demand during the week ended Nov. 23 triggered the initial reaction in futures trading. However, ULSD futures pared losses and the West Texas Intermediate and RBOB contracts were bobbing on either side of unchanged in late morning trading.

EIA reported a tenth consecutive weekly build in commercial crude stocks with the 3.6 million barrel (bbl) increase boosting inventory to a 450.5 million bbl one-year high. Yet, the build coincided with a 2.0 million bbl draw from the Strategic Petroleum Reserve and refinery crude inputs surged while the domestic run rate jumped 2.9% to a 95.6% 2-1/2 month high, as seasonal maintenance nears completion. That suggests more demand for crude in the coming weeks.

Distillate stocks increased for the first time in 10 weeks, up 2.6 million bbl to 121.8 million bbl while implied demand plunged 701,000 barrels per day (bpd) to a 3.569 million bpd 11-week low.

The standout statistic was a 1.543 million bpd surge in combined U.S. crude and products exports to a record high 8.714 million bpd.

Late morning, Nymex January WTI futures were flat at $51.56 bbl while December RBOB futures were up fractionally near $1.4220 gallon, trading at a nearly 2.0 cent premium to the December contract. Nymex December ULSD futures were down 2.0 cents near $1.8665 gallon, with January deliver at a 15 cent discount.

Brian L. Milne can be reached at brian.milne@dtn.com

(CZ)

Brian Milne