NEW YORK, Mar 10, 2010 (Dow Jones Commodities News via Comtex) --
By Brian Baskin
Of DOW JONES NEWSWIRES
Crude futures were nearly unchanged Wednesday, avoiding adding to the previous day's losses due to strength in the gasoline market.
Light, sweet crude for April delivery recently traded 3 cents higher at $81.52 a barrel on the New York Mercantile Exchange. Brent crude on the ICE futures exchange traded 9 cents, or 0.1%, higher at $80 a barrel.
Oil prices are still trading near their 2010 peak, but are unlikely to press higher before the release of U.S. oil inventory data, due out at 10:30 a.m. EST from the Energy Information Administration. The American Petroleum Institute, an industry group, reported a 6.5-million-barrel increase in crude stockpiles on Tuesday, raising fears that weak demand will reinflate supplies over the next few months.
Futures have traded between $70 and $80 a barrel for most of the last five months largely on the expectation that rising demand would soon draw down inventories in the U.S., the world's biggest oil consumer. Recently inventories have leveled off at well above average levels, but promising economic data has lifted many commodity markets, including oil.
Analysts gave an average forecast for a 1.7-million-barrel increase in oil inventories, according to a Dow Jones survey.
"The inventory data hasn't been a driver of price lately ... (but) if we build again, I have to believe we'll get some kind of correction," said Tom Bentz, a broker and analyst with BNP Paribas Commodity Futures Inc.
The API also reported a 3.2-million-barrel drop in gasoline stockpiles, where the consensus forecast was for an increase of 100,000 barrels. That decline has given new lift to an already buoyant gasoline market, where traders are anticipating strong summer demand out of the U.S. With U.S. gasoline consumption representing about 10% of total world oil demand, gains in the fuel's futures contract often boost oil prices as well.
"The gasoline market remains on a roll ... and it appears that the bullish gasoline momentum of the past month still has some room to run," wrote Jim Ritterbusch, president of the trading advisory firm Ritterbusch and Assoc. in Galena, Ill.
Analysts are also expecting distillate stockpiles, including heating oil and diesel, to drop by 700,000 barrels, while the API reported a 2.8-million-barrel decline in the category.
Front-month April reformulated gasoline blendstock, or RBOB, recently traded 89 points, or 0.4%, higher at $2.2692 a gallon. April heating oil traded 52 points, or 0.3%, higher at $2.0950 a gallon.
China, with oil demand second only to the U.S., provided additional support to prices after reporting a 20% increase in crude imports in February.
-By Brian Baskin, Dow Jones Newswires; 212-416-2453; firstname.lastname@example.org.
(END) Dow Jones Newswires