Oil $61 Little Changed After Falling on Signs U.S. Supplies Rising
By Gavin Evans
Sept. 27 (Bloomberg) -- Crude oil was little changed in New York after falling yesterday on speculation a government report today will show fuel stockpiles in the U.S., the world's biggest consumer, extended more than a month of gains.
An Energy Department report will probably show gasoline supplies climbed for a sixth time last week, rising 700,000 barrels, according to the median of 11 estimates in a Bloomberg News survey of analysts. Supplies of distillates, including heating oil and diesel, probably gained another 2.5 million barrels, according to the survey.
``I'm betting that we'll see a little build across the board,'' said Mark Waggoner, president of Excel Futures Inc. in Huntington Beach, California. ``We do have high stockpiles. As long as they remain around 11 and 12 percent above average, that's going to put a cap on prices.''
Crude oil for November delivery was at $61.11 a barrel, up 10 cents, in after-hours electronic trading on the New York Mercantile Exchange at 8:15 a.m. in Singapore.
The contract fell 44 cents, or 0.7 percent, to $61.01 a barrel yesterday on the New York Mercantile Exchange. Oil reached a six-month low of $59.52 on Sept. 25 and has closed within 66 cents of $61 each of the past five sessions.
``We've seen prices for a week relatively range-bound,'' Jason Schenker, an economist with Wachovia Corp. in Charlotte, North Carolina, said yesterday. ``None of the major fundamentals have changed. Inventories remain lush.''
U.S. Stockpiles
U.S. crude oil stockpiles held 327.7 million barrels on Sept 8, 11.7 percent above the five-year average for the period, according to Energy Department records. Inventories slipped to 324.9 million barrels on Sept. 15 and probably declined by a further 1.7 million barrels last week, according to the median estimate from a Bloomberg News survey of 11 analysts.
U.S. distillate inventories have risen for six straight weeks and held 148.7 million barrels on Sept. 15. Stockpiles the week before were 12 percent above the five-year average, the department said Sept. 13.
World oil demand peaks in the fourth quarter when refiners make heating fuel for the northern hemisphere winter. Demand in the quarter will average 85.6 million barrels a day, up 2.2 percent from a year earlier, the Organization of Petroleum Exporting Countries said in a Sept. 15 forecast.
Oil reached a record $78.40 a barrel on July 14. It has fallen 22 percent since then as U.S. stockpiles rose and a United Nations deadline for Iran to stop its nuclear research passed without sanctions being imposed.
Direction
Oil remains in a bull market even though it has retreated from recent highs, Excel's Waggoner said. Further declines will be limited and oil is likely to trade between $60 and $67 a barrel for the remainder of the year.
``At $60 there's going to be some incentive for OPEC to cap the production again,'' he said. ``Demand remains reasonably strong'' and it is still unclear how cold winter will be, he said.
Daily U.S. demand, as measured by deliveries of all oil products, fell the past four weeks to average 20.76 million barrels a day in the week ended Sept. 15, matching the average so far this year. Consumption averaged 20.7 million barrels through 2005, according to Energy Department data.
A weak El Nino weather pattern is likely to bring warmer- than-normal weather to the western U.S. from October through December, government forecasters said Sept. 21. There is an equal chance of above- or below-normal temperatures in the east, the U.S. Climate Prediction Center said.
The U.S. Northeast accounts for about 80 percent of the nation's domestic heating oil consumption.
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