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Friday, July 24, 2009

Crude crawls up again

Prices rise as earnings and economic reports boost sentiments

Positive earnings and economic data sent crude price higher on Thursday, 23 July, 2009. Prices have now risen in six out of seven sessions. Yesterday, prices fell as energy department reported increase in crude product stockpiles for last week.

On Thursday, crude-oil futures for light sweet crude for September delivery closed at $67.16/barrel (higher by $1.76 or 2.7%). It rose to a high of $69.5 earlier during the day. Last week, crude ended higher by 6.1%.

For the month of June, 2009, crude ended higher by 5.5%. In May, crude had registered the largest monthly gain in a decade rising 30%. For the second quarter, crude ended higher by 40%. Crude prices had rallied 11.3% in the first quarter of 2009.

Oil prices had reached a high of $147 on 11 July, 2008 but have dropped almost 52% since then. In July, 2009, it has dropped by 4.6% till date. Year to date, in 2009, crude prices are higher by 41.6%.

Stocks rallied at Wall Street today. Dow components AT&T, 3M and McDonald's all topped Wall Street's earnings estimates.

Among economic reports for the day, The National Association of Realtors reported on Thursday, 23 July, 2009 that resales of U.S. single-family homes and condos rose 3.6% in June to a seasonally adjusted annual rate of 4.89 million, the highest level since October, 2008. Resales have risen for three straight months for the first time in more than five years.

EIA reported yesterday that total inventories of crude, gasoline and other petroleum products rose 1.9 million barrels in the week ended 17 July, 2009 to 1,117.6 million barrels, up for a sixth straight week to the highest level since September 1990. But crude oil inventories fell last week as the U.S. imported less oil, but inventories gains in gasoline and other products were more than the drop in crude. Meanwhile, petroleum demand rose slightly, but still stayed way below last year's level.

The report said that crude oil inventories fell by 1.8 million barrels last week. Gasoline inventories rose by 800,000 barrels and distillate stockpiles, which include diesel and heating oil, increased by 1.2 million barrels.

Also at the Nymex on Thursday, August reformulated gasoline rose 7.49 cents, or 4.1%, to $1.9132 a gallon and August heating oil gained 5.32 cents, or 3.1%, to $1.7644 a gallon.

August natural gas futures fell 24.3 cents, or 6.4%, to $3.55 per million British thermal units.

Crude prices had ended FY 2008 lower by 54%, the largest yearly loss since trading began at Nymex.

At the MCX, crude oil for August delivery closed higher by Rs 75 (2.4%) at Rs 3,245/barrel. Natural gas for August delivery closed at Rs 182.8/mmbtu, lower by Rs 11.9/mmbtu (6.1%).

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