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Crude oil prices trade in narrow range ahead of U.S. government inventory report

Crude oil prices trade in narrow range ahead of U.S. government inventory report

Oil prices fluctuated in a narrow range Tuesday, moving higher one moment and lower the next on concerns about what Wednesday's government report on oil and gasoline inventories will show.
"Tomorrow's the big day," said Erit Wittenauer, an energy futures analyst at A.G. Edwards & Sons in St. Louis.
Light, sweet crude for June delivery rose 3 cents to $65.74 a barrel in midday trading on the New York Mercantile Exchange.
Driving the market are gasoline futures, analysts say. Gasoline for June delivery was up 1.97 cents to $2.2791 a gallon on the Nymex.
The average price of a gallon of gas at the pump rose to $2.965 on Tuesday, according to the price watcher AAA, up more than a penny from late Monday and more than 29 cents from a month ago.
Brent crude for June on London's ICE Futures exchange jumped 57 cents to $68.22 a barrel.
Traders are concerned that Wednesday's inventory report will again show an increase in crude oil stockpiles, and a decrease in gasoline supplies. Last week's U.S. Energy Department report showed an unexpected drop of 2.8 million barrels in U.S. gasoline stockpiles and said U.S. refinery use declined to 87.8 percent of capacity.
A number of refinery accidents and outages have contributed to the crunch, analysts say.
"Until we start to see refineries come back from the maintenance season ... the market's going to continue to be led by gasoline," Wittenauer said. "There's a fear built into the market that there won't be enough gasoline for the summer driving season."
Gasoline inventories will reverse course and climb _ sometime soon, said Mike Lynch, an oil market analyst at Strategic Energy and Economic Research Inc., in Amherst, Massachusetts.
"I think the price (of gasoline) is close to peaking out," Lynch said. But until inventories show signs of increasing, he said "nobody wants to take a bearish position on gasoline."
Also on traders plates Tuesday was news that gunmen in Nigeria kidnapped six foreign oil workers and killed a Nigerian sailor on a Chevron Corp. ship.
"This incident has once again highlighted the instability in the region, with the country's output still below full capacity, and the most recent presidential elections have only made the situation worse," said Michael Davies, an analyst at Sucden in London.
A Nigerian spokesman for California-based Chevron said the company had shut down an oil station that supplies the ship because of the attack, decreasing production by 15,000 barrels a day.
In a separate incident, gunmen seized the mother of the newly elected governor of neighboring Rivers state, police said.
"I think it is supportive of the market, but it's nothing new," said Wittenauer of the situation in Nigeria.
In other Nymex trading, heating oil futures rose less than a penny to $1.9036 a gallon on the Nymex, while natural gas futures fell 7.1 cents to $7.792 per 1,000 cubic feet.


Updated : 2021-05-18 04:45 GMT+08:00