CRUDE SUMMARY: Oil down as US stock levels hit record high

23 April 2014 19:52  [Source: ICIS news]

LONDON (ICIS)--Crude futures opened on Wednesday with the weekly US stock figures published late on Tuesday by the American Petroleum Institute (API) showing a smaller build on crude stocks than forecast, but it did not take long before both NYMEX West Texas Intermediate (WTI) and Brent fell into negative territory.

Prior the European market opening, both contracts weakened further, but Brent managed to surge quickly back into positive territory on news of more North Sea Forties cargoes being delayed into May due to reduced production from non-Buzzard oil fields.

Brent then moved sideways in choppy trade until the US opening, whereas the NYMEX plummeted deeper into negative territory before gradually regaining a good portion of the lost ground.

As the US market began to trade, both contracts surged into positive territory, but they failed to hold the gains and eased off again prior the appearance of the stock figures from the Energy Information Administration (EIA).

Prices took a sharp drop when these showed a larger build on crude than forecast, plus a smaller than expected draw on gasoline. This took overall US crude stocks rose to their highest level since records began in 1982, whereas stocks at the Cushing, Oklahoma delivery hub fell to the lowest level since October 2009.

Brent plunged to a new low, but the NYMEX held above its earlier low before staging a decent recovery.

Both dropped away again but then staged another recovery, which took the NYMEX back into mildly positive territory. However, it failed to hold there and fell away sharply in late trading, while Brent remained mired in negative territory.

June Brent closed the day down 16 cents/bbl at $109.11/bbl, having traded in a range between $108.60/bbl and $109.54/bbl.

June WTI closed the day down 31 cents/bbl at $101.44/bbl, having traded in a range between $101.20/bbl and $102.08/bbl.

Additional reporting by Kawai Wong

By: Tony Dillon
+44 20 8652 3214

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