WSJ:OIL FUTURES: Crude Mixed in Asia; OPEC Meeting, Stock Data in Focus
By Eric Yep
Crude-oil futures are mixed in Asia ahead of a meeting of the Organization of Petroleum Exporting Countries Thursday, which may decide to keep oil markets adequately supplied, while investors remain cautious about the euro zone due to Spain's high borrowing rates.
On the New York Mercantile Exchange, light, sweet crude futures for delivery in July traded at $83.17 a barrel at 0659 GMT, down $0.15 in the Globex electronic session. July Brent crude on London's ICE Futures exchange rose $0.23 to $97.37 a barrel.
At Thursday's OPEC meeting, analysts expect the cartel to maintain its current production ceiling despite criticism from some member countries due to weakening demand and falling prices.
In its latest monthly report, OPEC disclosed that its crude production in April was at 32.964 million barrels a day, up 631,000 barrels a day from the previous month, reflecting high output levels not seen since 2008.
Separately, the U.S. Energy Information Administration said in its monthly report that global company-held oil inventories in the major industrialized nations will be sufficient to cover 57.7 days of demand at the end of 2012, the highest level in 15 years.
However, ANZ expects oil supply to tighten going forward.
"The Northern Hemisphere summer driving season, seasonal demand in Asia and increasing hurricane/risks also have the potential to draw down stockpiles and switch investor focus from softer macro sentiment to more positive fundamental drivers" in the third quarter, it said.
The American Petroleum Institute, an industry group, says U.S. crude stocks rose by 1.593 million barrels last week. However, 14 analysts surveyed by Dow Jones Newswires expect more closely watched EIA data, due at 1430 GMT, to show a 1.6 million-barrel decline.
The market is also cautious due to uncertainty in the euro zone.
"The roller coaster in global risk environment remains prevalent as we are nearing the crucial June 17 Greek election," OCBC Bank said. "Concerns, however, are not going to disappear just like that and, in fact, pressures continue to mount on Spain, as its 10-year bond yields touched a multi-year record high of 6.83%."
In the run-up to negotiations over Iran's nuclear program in Moscow next week, Iran has justified producing weapons-grade nuclear fuel, saying it's working on a nuclear-powered submarine, which will likely gain it some leverage ahead of the talks.
Nymex reformulated gasoline blendstock for July--the benchmark gasoline contract--rose 55 points to $2.6557 a gallon, while July heating oil traded at $2.6277, 62 points higher.
ICE gasoil for July changed hands at $843.75 a metric ton, down $2.25 from Tuesday's settlement.
