West Texas Intermediate crude held near the highest level in two weeks after a government report showed on Wednesday that supplies at the nation’s biggest storage hub fell for an eight straight week after the commissioning of a new pipeline, while gasoline demand surged to the highest in three months. Meanwhile, natural gas futures traded little changed ahead of a government report that may show a smaller than last years gas withdrawal.
On the New York Mercantile Exchange, WTI crude for delivery in May traded at $100.36 per barrel at 10:24 GMT, up 0.1% on the day. Prices shifted in a daily range between $100.41, near yesterday’s two-week high of $100.46, and $100.03 per barrel. The US benchmark jumped by 1.1% on Wednesday, a third daily advance in four, and settled at $100.26 per barrel, the highest close since March 19th.
Meanwhile on the ICE, Brent futures for delivery in the same month stood at $107.16 per barrel, up 0.12% on the day. The contract held between day’s high and low of $107.20 and $106.77 a barrel. The European crude benchmark added 0.04% on Wednesday and settled at $107.03 per barrel. Brent traded at a premium of $6.70 to WTI after the gap closed at $6.77 on Wednesday, down from $7.80 on Tuesday.
US crude drew support and narrowed its discount to its European counterpart after the Energy Information Administration reported on Wednesday that supplies at Cushing, Oklahoma, the biggest US storage hub and delivery point for NYMEX-traded contracts, fell for an eight consecutive week in the seven days through March 21st. Supplies at the hub slid 1.33 million barrels to a two-year low of 28.5 million.
Total motor gasoline inventories fell by 5.1 million barrels to 217.2 million, outstripping expectations for a decline of 1.7 million barrels, as gasoline demand jumped by 5.8% to a three-month high of 9.002 million bpd. Distillate fuel inventories, which include diesel and heating oil, rose by 1.56 million barrels to 112.4 million, defying analysts’ projections for a 1.1-million-barrel drop.
Meanwhile, on the New York Mercantile Exchange, natural gas for delivery in April traded little changed at $4.394 per million British thermal units at 10:28 GMT, down 0.02% on the day. Prices held in a daily range between $4.402 and $4.367 per mBtu.
Prices of the energy source were pressured by expectations for a smaller drop in supplies compared to a year ago and weather forecasting models which called for a gradual warm-up across the US. According to the median estimate of 17 analysts in a Bloomberg survey, the weekly US gas storage report scheduled to be released at 14:30 GMT, may show that inventories fell 52 billion cubic feet last week, compared to 90 bcf during the same week last year.
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