BLBG:WTI Crude Fluctuates After Capping Biggest Gain in Three Weeks
West Texas Intermediate swung between gains and losses after the biggest increase in three weeks yesterday amid speculation U.S. crude stockpiles fell.
Futures were little changed in New York after rising 1.6 percent yesterday. U.S. inventories probably shrank by 2 million barrels last week, a Bloomberg News survey showed before a government report tomorrow. Prices dropped earlier after Enbridge Inc. (ENB), the largest transporter of Canadian crude to the U.S., said it restarted a segment of a pipeline system.
“The market does need to see inventories starting to come off,” said Ric Spooner, a chief market analyst at CMC Markets in Sydney. “We’re into the driving season, and a failure to do that would be a concern.”
WTI for August delivery was at $95.27 a barrel, up 9 cents, in electronic trading on the New York Mercantile Exchange at 2:55 p.m. Singapore time. The volume of all futures traded was more than double the 100-day average. The contract climbed $1.49 to $95.18 yesterday, the most since June 3.
Brent for August settlement was at $101.31 a barrel, up 15 cents on the London-based ICE Futures Europe exchange. The European benchmark grade was at a premium of $6.01 to WTI. The spread was $5.98 yesterday, the narrowest based on closing prices since January 2011.
U.S. gasoline inventories probably increased by 1 million barrels in the week ended June 21, according to the median estimate of nine analysts surveyed before the Energy Information Administration report. Distillate-fuel supplies, including heating oil and diesel, are expected to have risen by 1 million barrels.
Refinery Operations
Refineries probably operated at 89.6 percent of capacity last week, up 0.3 percentage points from the prior period, the survey shows. That would be the highest rate since December. Plants typically boost output this time of year to meet U.S. summer demand for motor fuel.
The government report will follow separate inventory data from the American Petroleum Institute today. The industry group collects the information on a voluntary basis from operators of refineries, bulk terminals and pipelines. The government requires that reports be filed with the EIA for its weekly survey.
Enbridge restored operations on the southern segment of the Athabasca pipeline network and will restart other lines over the next “several days,” it said yesterday. The Calgary-based company shut the Athabasca and Waupisoo systems, which have a total capacity to move as much as 1.17 million barrels a day, after finding a 750-barrel spill on June 22 from Line 37, a link serving Nexen Inc.’s Long Lake oil-sands complex.
Goldman Sachs
Canada supplied more than one quarter of U.S. crude imports last year, according to data from the EIA, the Energy Department’s statistical arm.
World oil consumption will increase in the second half of this year as economic growth continues to recover, Goldman Sachs Group Inc. said today.
“Global demand is picking up, both seasonally as we come out of the weakest period in the second quarter and on a year-over-year basis as global growth continues to recover, despite the recent China downgrade,” Stefan Wieler, a Goldman commodity analyst in New York, wrote in an e-mailed report. “We expect fundamentals to improve further going into the second half of 2013.”
The loss of “substantial volumes” of crude production from Libya, Iraq, Syria, Nigeria, Sudan and South Sudan also “creates growing upside risk,” Wieler wrote.
To contact the reporter on this story: Ben Sharples in Melbourne at bsharples@bloomberg.net
To contact the editor responsible for this story: Alexander Kwiatkowski at akwiatkowsk2@bloomberg.net
