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Thursday, December 04, 2014

Crude registers moderate gains

Prices rise following unexpected decline in crude inventories 


Crude-oil futures rose on Wednesday, 03 December 2014 at Nymex picking up more steam after a U.S. government-supply report showed an unexpected decline in crude inventories.
On the New York Mercantile Exchange, light, sweet crude futures for January delivery rose 50 cents, or 0.8%, to settle at $67.38 a barrel. 

The Energy Information Administration reported earlier Wednesday that U.S. crude-oil supplies declined 3.7 million barrels on the week ended 28 November 2014. Market had expected crude inventories to increase by 380,000 barrels on the week. The EIA also reported gasoline inventories rose by 2.1 million barrels, while supplies of distillates rose by three million barrels. Gasoline futures ended at a five-year low on Wednesday. Market had expected distillates supplies to decline by 1.2 million barrels and gasoline stockpiles to end the week unchanged. 

ADP national employment report came out and did not quite meet market expectations. The figure showed a rise of 208,000 jobs in November, while the market place was expecting something in the range of up 230,000. 

The U.S. dollar index hit a four-year high Wednesday and the Euro currency fell to a two-year low against the greenback. This was an underlying negative for the precious metals markets today that did limit the upside. The latest European Union purchasing managers index (PMI) came in weaker than expected Wednesday, which pressured the Euro. The data firm Markit reported the said the composite EU PMI for November was 51.1 versus 52.1 in October. A reading above 50.0 suggests the sector is growing. 

The European Central Bank holds its monthly meeting on Thursday. Many believe the ECB will not yet move to further stimulate EU monetary policy, but most think its coming. Recent economic data coming out of the European Union suggests the ECB will make its move in the first quarter of 2015. 

Among other energy markets, January gasoline retreated less than a penny, or 0.3%, to settle at $1.8070 a gallon on Nymex. That was gasoline's lowest settlement since October 2009. January heating oil lost 2 cents, or 1%, to finish at $2.1334 a gallon on Nymex. 

Natural gas for January delivery fell 7 cents, or 1.8%, to end at $3.8050 per million British thermal units. Natural-gas futures have ended lower for five straight sessions.
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