Oil prices edge higher ahead of U.S. inventory data

Posted By: EN Todayon: February 22, 2024In: General Energy News, Oil & Gas News

Oil futures rose Thursday as investors awaited official data on U.S. inventories after industry figures were said to show a large rise in crude stocks.

Price moves

West Texas Intermediate crude for April delivery
CL00,
-0.14%

CL.1,
-0.14%

CLJ24,
-0.14%
rose 17 cents, or 0.2%, to $78.08 a barrel on the New York Mercantile Exchange.
April Brent crude
BRN00,
-0.16%

BRNJ24,
-0.16%,
the global benchmark, was up 17 cents, or 0.2%, at $83.20 a barrel on ICE Futures Europe.
Back on Nymex, March gasoline
RBH24,
-0.53%
fell 0.2% to $2.281 a gallon, while March heating oil
HOH24,
-0.52%
edged down 0.1% to $2.66 a gallon.
March natural gas
NGH24,
-2.48%
dropped 2% to $1.737 per million British thermal units after a 12.5% jump the previous session, its biggest one-day percentage gain since July 7, 2022.

Market drivers

Oil futures were trading near the top of the price range seen over the last three weeks, as traders continued to monitor developments in the Middle East and weighed the outlook for crude demand. An increasing backwardation, in which prices for nearby contracts exceed those for longer-dated futures, is seen pointing to tighter physical supplies.

But industry data pointed to another sharp rise in U.S. crude inventories last week. Analysts said the American Petroleum Institute, an industry trade group, late Wednesday reported that U.S. crude stocks rose 7.2 million barrels last week, while supplies at the Nymex delivery hub in Cushing, Oklahoma, rose 700,000 barrels. Product inventories were mixed, however, with gasoline up 420,000 barrels and distillate supply down 2.9 million barrels.

Official data from the Energy Information Administration is due Thursday morning. Analysts surveyed by S&P Global Commodity Insights, on average, expect the data to show crude inventories rose 4.4 million barrels to around 444 million barrels in the week ended Feb. 16.

The survey found analysts expect refinery runs to remain soft for the rest of the month as BP PLC’s
BP,
-0.29%

BP,
+0.90%
Whiting, Indiana, facility remains shut due to an unexpected power outage and a number of other refineries continue to undergo maintenance.

Natural-gas futures were under renewed pressure after a Wednesday bounce sparked by guidance from Cheseapeake Energy Corp.
CHK,
+7.98%,
which said its capital plan would support production this year in the range of 2.65 billion to 2.75 billion cubic feet a day, or bcf/d. Chesapeake produced the equivalent of 3.43 bcf/d in fiscal 2023, 98% of which was natural gas.

Analysts expect the EIA to report a 65-billion cubic feet withdrawal from U.S. natural gas storage for the week ending Feb. 16, according to S&P Global Commodity Insight’s survey.