Crude at six month high

Prices rise as crude inventories rise less than expected

Crude oil ended at highest levels in almost six months on Wednesday, 06 May, 2009. Prices rose today as energy department's weekly inventory report showed that crude inventories rose less than expected last week and also gasoline inventories dropped.

On Wednesday, crude-oil futures for light sweet crude for June delivery closed at $56.34/barrel (higher by $2.5 or 4.6%) on the New York Mercantile Exchange. Last week, crude ended higher by 3.2%.

Crude ended April higher by 2.9%. Previously, March trading ended 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 61% since then. Year to date, in 2009, crude prices are higher by 19.7%. On a yearly basis, crude prices are lower by 43%.

EIA reported today that crude inventories increased by 600,000 barrels in the week ended 1 May, 2009. Gasoline inventories fell by 200,000 barrels. Market was expecting a buildup of more than 2 million barrels in crude inventories and a 750,000 increase in gasoline inventories. Crude inventories, meanwhile, still remained at the highest level since September 1990.

The report also showed that total petroleum demand over the past four weeks was 7.9% lower than a year ago. EIA also reported U.S. refineries increased their capacity utilization of 85.3%, up from 82.7% a week ago.

Also at the Nymex on Wednesday, June reformulated gasoline rose 5.58 cents, or 3.5%, to $1.628 a gallon and June heating oil added 4.51 cents, or 3.2%, to $1.4713 a gallon.

Natural gas for June delivery rose 25.6 cents, or 7.1%, to $3.871 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 May delivery closed at Rs 2,778/barrel, higher by Rs 102 (3.8%) against previous day's close. Natural gas for May delivery closed at Rs 191.3/mmbtu, higher by Rs 12.9/mmbtu (7.2%).