Wednesday, February 9, 2011

Crude Oil Gains Moderating After Domestic Inventories Rise Less Than Expected

"Crude oil for March delivery is closing in on $88 a barrel after getting some lift from the latest report on domestic oil stockpiles, which rose less than expected for the week ended Feb. 4.

The Energy Information Administration reported a 1.9-million-barrel gain in crude inventories, short of the 2.4-million-barrel increase forecast by analysts polled by Platt's, which tracks oil markets.

Gasoline supplies also gained 4.7 million barrels for the week, topping analysts who were looking for a consensus gain of 3.1 million barrels. Distillates, which include heating oil and diesel, gained 300,000 barrels, while analysts were looking for a decline of 1.4 million barrels. Crude was already moving higher ahead of the report trading at around $87.23 a barrel on the New York Mercantile Exchange after a report that Saudi Arabian crude reserves might not be as ample as previously reported.

Crude gains are moderating since the EIA report was released, with light sweet crude up 36 cents at $87.30 a barrel on the NYMEX.

The United States Oil exchange traded fund (USO) is trading at $36.48, down 16 cents, or 0.44%.