Crude prices slip for fifth straight day

Prices continue to bear the brunt of rising stockpiles

Crude prices ended lower for fifth straight day on Thursday, 02 February 2012 at Nymex. Prices ended lower following yesterday's weekly inventory report from the energy department which showed stronger than expected buildup in crude inventories for last week. Prices also fell due to slight increase in dollar index.

Light and sweet crude for March delivery fell $1.84 (1.9%) to $95.75 a barrel on the New York Mercantile Exchange on Thursday. Prices fell 0.4% for the month of January. Prices rose 1.3% last week.



In the latest weekly inventory report, the EIA reported yesterday that crude inventories rose by 4.2 million barrels in the week ended 27 January 2012. Market was expecting a rise by 3 million barrels. The EIA also said gasoline inventories rose 3 million barrels, and supplies of distillates declined by 100,000 barrels. Market had expected distillate supplies to be down 1.2 million barrels and gasoline stocks to rise 1 million barrels.

In the currency market on Thursday, the Dollar Index, which weighs the strength of dollar against basket of six other currencies stayed in the red for almost the entire day but ultimately rose by almost 0.05%.

There were a few fresh developments coming out of the European Union debt crisis on Thursday. A Spanish bond auction saw mixed results but with lower yields fetched. A debt- restructuring deal between the Greek government and the private sector has still not been reached, but an agreement is reportedly closer.

Among economic reports expected for the day at Wall Street on Thursday, weekly initial jobless claims proved slightly better than expected by easing down to 367,000. However, that report didn't generate much excitement with the highly-anticipated monthly payrolls report due tomorrow.

March natural gas, rose 12 cents, or 5.1%, to $2.51 per million British thermal units. The Energy Information Administration reported a decline of 132 billion cubic feet in the week ended 27 January 2012. Market had expected a net withdrawal between 123 bcf and 127 bcf.

At the MCX, crude oil for February delivery closed lower by Rs 134 (2.7%) at Rs 4,727/barrel. Natural gas for February delivery closed at Rs 124.3, higher by Rs 4.8 (4%).