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Oil prices rise on US refinery concerns, fuel stocks data

Oil prices rise on US refinery concerns, fuel stocks data

Oil prices rose Tuesday following reports of problems at two U.S. refineries and amid expectations a midweek U.S. petroleum stocks report will show gasoline supplies fell again.
The refinery problems have caused some concern over gasoline tightness in the U.S., particularly after the U.S. Energy Department reported last week a surprisingly large decline in gasoline stockpiles and continued high demand beyond the traditional U.S. driving season. In this week's report, due Wednesday, gasoline stocks are expected to fall 1.8 million barrels, according to a Dow Jones Newswires survey of analysts.
Crude stocks are expected to fall 800,000 barrels, according to the survey, and distillate stocks, which include diesel and heating oil, are forecast to build 600,000 barrels. Refinery utilization rates are forecast to remain unchanged.
Light, sweet crude for October delivery added 13 cents to fetch US$72.10 a barrel in electronic trading on the New York Mercantile Exchange by midday in Europe. The contract rose 88 cents to US$71.97 a barrel Monday in the U.S.
Nymex gasoline prices were up slightly at US$2.04 a gallon (3.8 liters) in the wake of a mid-August fire at Chevron Corp.'s 330,000-barrel-per-day refinery at Pascagoula, Mississippi. Gasoline prices rose 5.79 cents during the previous session due to related concerns.
"There are reports of refinery glitches coming up at a few locations in the U.S. and so gasoline futures prices have gone up and the gasoline market has also driven up the crude oil market," said Victor Shum, an energy analyst with Purvin & Gertz in Singapore.
"Crude really derives all its value from the products that can be made from it. So when product prices go up, there is a knock-on effect on crude."
Still, Vienna's PVM Oil Associates noted that the high-demand U.S. driving season was about to come to an end, and "long-year seasonality suggests a downturn in the weeks to come."
Trade media reports late last week said Chevron had canceled a 550,000-barrel Venezuelan crude order. The company has declined to verify that report, but did say, "we are working closely with our crude suppliers and expect some crude shipments may be canceled or rerouted to other refineries in our global network."
Gasoline prices were also boosted by talk that Citgo Petroleum Corp.'s refinery in Corpus Christi, Texas, had to cut rates at a key gasoline production unit, though a company spokesman declined to confirm this.
In London, October Brent crude rose 6 cents to US$71.01 a barrel on the ICE Futures exchange.
Heating oil futures on Nymex were flat at US$2.01 a gallon (3.8 liters). Natural gas prices slipped by 14 cents to US$5.366 per 1,000 cubic feet.
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Associated Press writer Gillian Wong in Singapore contributed to this report.


Updated : 2021-03-06 08:00 GMT+08:00