Crude falls $1/bbl on renewed demand concerns

27 November 2008 10:09  [Source: ICIS news]

SINGAPORE (ICIS news)--Crude fell more than $1/bbl on Thursday as concerns over waning demand re-emerged following the previous day’s gains of around 7%, which had been driven by a stock market rally and short covering ahead of the US Thanksgiving holiday.

At 09:25 a.m. GMT on Thursday, January NYMEX light sweet crude futures were trading at $53.33/bbl, down $1.11/bbl on Wednesday’s settlement level. Earlier it rose to a high of $52.62/bbl, up $1.82/bbl.

At the same time, January Brent on London’s ICE futures was trading at $52.78/bbl, up $1.14/bbl on Wednesday’s settlement price. Earlier it hit a high of $51.98/bbl, up $1.94/bbl.

Prices fell on Thursday as traders again focused on weekly supply data from the Energy Information Administration (EIA) released on Wednesday, which revealed a much larger-than-expected build in crude stocks, and a smaller-than-anticipated draw on distillates and heating oil.

The EIA data showed that crude stocks rose by 7.3m bbls, compared with forecasts of just 800,000 bbls.

Gasoline stocks rose by 1.9m bbls, compared with a forecast build of just 400,000 bbls.

Distillate stocks posted a draw down of 200,000 bbls against an expected decline of 800,000 bbls.

Data from the EIA also revealed that total products supplied in the US over the last four weeks averaged around 19.2m bbls/day, down 6.6% from the same period last year.

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By: James Dennis
+65 6780 4359

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