BLBG:WTI Set for Best Month Since August Before U.S. Oil Supply Data
West Texas Intermediate headed for its strongest month since last August before the release of data forecast to show that crude inventories fell in the U.S., the world’s largest consumer of the commodity.
Futures gained as much as 0.6 percent in New York and have advanced 7.2 percent this month. A government report today is forecast to show crude supplies slid by 2.45 million barrels last week, according to a Bloomberg News survey of analysts. The American Petroleum Institute said yesterday that crude inventories decreased by 740,000 barrels. Data on U.S. economic growth is also due today, while the Federal Open Market Committee will conclude a two-day meeting.
“U.S. refinery activity is very high, which can explain the continued decline in crude stocks,” said Carsten Fritsch, an analyst at Commerzbank AG in Frankfurt. “But fuel demand is still lackluster, which means fuel stocks are still quite high and have risen of late.”
WTI for September delivery rose as much as 65 cents to $103.73 a barrel in electronic trading on the New York Mercantile Exchange and was at $103.45 at 10:09 a.m. London time. The volume of all futures traded was 21 percent below the 100-day average. The contract fell $1.47 yesterday, dropping the most since July 24 and closing at the lowest level since July 3.
Fuel Stockpiles
Brent for September settlement fell 46 cents to $106.45 a barrel on the London-based ICE Futures Europe exchange. The European benchmark was at a premium of $2.89 to WTI futures, down from $3.83 yesterday.
U.S. futures rose to the highest price in 16 months on July 19 amid signs of economic recovery in the U.S. and declining crude inventories. WTI traded at parity to Brent briefly that day for the first time in almost three years as better pipeline networks and the use of rail helped to unlock a supply glut at Cushing, Oklahoma, the delivery point for New York futures. Prices are up 13 percent this year.
U.S. gasoline supplies increased by 1.8 million barrels last week, the API said. A report today from the Energy Information Administration, the Energy Department’s statistical unit, will probably show stockpiles declined by 1.5 million barrels, according to the median estimate of 12 analysts in the Bloomberg survey.
Distillate inventories, a category that includes heating oil and diesel, decreased by 497,000 barrels last week, the API said. They are projected to increase by 450,000 barrels in the EIA report, due for release at 10:30 a.m. in Washington, according to the survey.
U.S. Growth
The API in Washington collects 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.
U.S. economic growth slowed in the second quarter, according to a Bloomberg News survey before data from the Commerce Department at 8:30 a.m. local time. Gross domestic product probably expanded at a 1 percent annualized rate from April through June, compared with 1.8 percent in the previous three months, the survey shows.
Two gauges of China’s manufacturing probably fell in July, according to separate Bloomberg surveys. An official Purchasing Managers’ Index slid to 49.8 from 50.1, according to forecasts from a survey before data from the National Bureau of Statistics and China Federation of Logistics and Purchasing tomorrow. A private PMI from HSBC Holdings Plc and Markit Economics probably slipped to 47.7 from 48.2, the second survey showed. Readings above 50 signal expansion.
South Sudan held back from closing its oil wells after receiving formal notification from neighboring Sudan that a planned shutdown of exports is being delayed, the Petroleum Ministry said.
“We will instruct the oil companies operating in South Sudan not to shut down as scheduled,” Nicodemus Ajak Bior, a ministry spokesman, said in a phone interview yesterday from Juba, the capital.
To contact the reporter on this story: Ben Sharples in Melbourne at bsharples@bloomberg.net Grant Smith in London at gsmith52@bloomberg.net
To contact the editor responsible for this story: Stephen Voss on sev@bloomberg.net
