Aug 16 2012
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OIL FUTURES: Crude Oil Prices Mixed, Brent Contract Expires
Thursday, Aug 16, 2012
-- Market struggles to find direction in London session
-- Thin trading, Brent September contract expires Thursday
-- Tight supply in the North Sea supports prices
By Jenny Gross
LONDON--Crude oil futures were mixed Thursday, holding near three-month highs, as traders stayed on the sidelines ahead of key data releases due later.
Brent crude oil prices stayed in positive territory while West Texas Intermediate held slightly in the red. Overall, traders were in "wait-and-see" mode, with volumes low, analysts said.
Market participants are focusing on U.S. housing starts for July, weekly jobless claims and Philadelphia Fed business outlook survey for August later in the day for cues on the strength of the U.S. economy.
"You've got to remember that the September contract expires today in London, so in low volume trading, it can easily push the market higher," said Andrey Kryuchenkov, vice president of commodities research at VTB Capital.
"There's some geopolitical concerns and recent war mongering, but also matters are not stabilizing in Syria," Mr. Kryuchenkov said. "Tensions have been on the rise in the Middle East, which gives the market support."
While Syria isn't a major oil producer on a global scale, market participants are worried that unrest there could spread elsewhere in the oil-rich Middle East. Already, tension has spilled into Lebanon, with Saudi Arabia, the United Arab Emirates, Qatar and Kuwait urging their citizens to leave the country.
Meanwhile, a surprise drop in U.S. crude oil inventories supported the market. The U.S. Department of Energy's weekly oil-inventory report, released Wednesday, signalled tighter-than-expected supply of crude and petroleum products in the U.S. It said U.S. oil stockpiles fell 3.7 million barrels last week. The drop was well above the 1.9 million-barrel-draw forecast by analysts surveyed by Dow Jones Newswires, and came as U.S. demand for gasoline rose to a 13-month high.
JBC Energy said inventories could continue to decline next week given that U.S. refinery utilization rates are at a high level of 92.6%.
At 1034 GMT, the ICE's gasoil contract for September delivery was trading $9.75 higher, or 1%, at $978.75 per metric ton, while Nymex gasoline for September delivery was down 46 points, or 0.2%, at $3.0794 per gallon.
-Write to Jenny Gross at firstname.lastname@example.org; Twitter: @jgginlondon
(END) Dow Jones Newswires
August 16, 2012 06:42 ET (10:42 GMT)
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