MW: Oil futures rangebound before U.S. inventory data
By Eric Yep
Crude-oil prices were marginally higher in Asia Tuesday, but traded within a narrow range ahead of weekly U.S. oil inventory data that analysts say is expected to show rising supply levels.
On the New York Mercantile Exchange, light, sweet crude futures for delivery in June traded at $102.73 a barrel at 0550 GMT, up $0.12 in the Globex electronic session. July Brent crude on London's ICE Futures exchange rose $0.13 to $109.50 a barrel.
"In the U.S., analysts predict a modest rise in crude stocks and a draw in distillate inventories as the country approaches the start of the driving season following the Memorial Day holiday on 26 May," ANZ said in a report.
U.S. oil stockpile data for last week are due from the American Petroleum Institute, a trade body, later Tuesday. The more definitive oil stockpile data from the U.S. Energy Information Administration are due Wednesday.
While Brent crude has rallied on the back of supply issues, including production problems in the North Sea, weak demand for petroleum products is putting pressure on refining margins, Morgan Stanley said in a note.
"Despite record U.S. demand, gasoline cracks continue to drift lower as U.S. gasoline imports refill the East Coast, leaving stocks to trend bearish," the bank said, adding that U.S. diesel margins are also depressed.
Meanwhile, geopolitics are keeping a floor on oil prices.
Oil markets are cautious with reports of clashes between rival militias in Libya after the storming of its parliament by forces loyal to a renegade general, while the Ukraine crisis continues to play out.
Nymex reformulated gasoline blendstock for June--the benchmark gasoline contract--rose 40 points to $2.9686 a gallon, while June heating oil traded at $2.9469, 60 points higher.
ICE gasoil for June changed hands at $910.00 a metric ton, down $2.25 from Monday's settlement.
