Crude goes down

Oil prices fall as crude inventories build up

Oil prices fell on Wednesday, 01 April, 2009 after energy department reported build up in crude inventories last week.

On Wednesday, crude-oil futures for light sweet crude for May delivery closed at $48.39/barrel (lower by $1.27 or 2.6%) on the New York Mercantile Exchange. Last week, crude ended higher by 0.6%.

Crude ended March trading up 10.9%. It rallied 11.3% in the first quarter. For the month of February, crude prices had ended higher by 1.5%.

Oil prices had reached a high of $147 on 11 July, 2008 but have dropped almost 63% since then. Year to date, in 2009, crude prices are higher by 11.6%. On a yearly basis, crude prices are lower by 52%.

As per the report, crude inventories rose 2.8 million barrels, staying at the highest level since July 1993. Crude inventories, the delivery point for Nymex oil futures, fell 800,000 barrels to 30.9 million barrels.

The report also said that gasoline inventories increased 2.2 million barrels in the week ended 27 March, 2009. The EIA also reported an increase of 300,000 barrels in distillate stockpiles, which include diesel and heating oil.

EIA also reported that total demand for petroleum demand over the last four-week period averaged 18.9 million barrels a day, down by 4.4% compared to the similar period last year. Among them, motor gasoline demand averaged 9 million barrels a day, down by 0.2% from a year ago, while distillate fuel demand slumped by 9.1%. U.S. refineries operated at 81.7% of their operable capacity last week, down from the 82% a week ago,

Also at the Nymex on Wednesday, May reformulated gasoline fell 4.96 cents, or 3.5%, to $1.3717 a gallon and May heating oil dropped 2.21 cents, or 6%, to $1.3458 a gallon.

May natural gas also lost 8.1 cents, or 2.1%, to $3.695 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 March delivery closed at Rs 2,426/barrel, lower by Rs 55 (2.2%) against previous day's close. Natural gas for April delivery closed at Rs 189/mmbtu, lower by Rs 1.9/mmbtu (0.99%).