US crude futures surge $1.69/bbl on inventory forecasts

28 January 2014 20:35 Source:ICIS News

(clarifies third paragraph on stock market rally)

HOUSTON (ICIS)--NYMEX light sweet crude for March delivery settled at $97.41/bbl, up $1.69, on Tuesday in response to forecasts that weekly supply statistics from the American Petroleum Institute (API) and the Energy Information Administration (EIA) will reveal a drawdown in heating oil and propane inventories as a result of extremely cold weather affecting most of the country.

The API statistics will be released on Tuesday afternoon and the EIA data on Wednesday morning. Crude oil inventories are expected to show a build but will be overshadowed by the drawdown in refined products.

Crude prices also tracked a healthy rally in the stock market, which followed five consecutive down days for the Dow Jones Industrial Average. Investors are weighing expectations that the US Federal Reserve will trim further the economic stimulus programme after a two-day meeting this week.

Reversing the losses posted on Monday, March West Texas Intermediate (WTI) topped out at $97.66/bbl, up $1.94, before retreating.

ICE Brent for March delivery established an intra-day high of $107.79/bbl before settling at $107.41/bbl, up 72 cents.

By Ignacio Sotolongo