HOUSTON, July 20 -- Crude oil prices gained in New York and London markets on July 19, and a mid-year report from the American Petroleum Institute indicated slow demand growth for refined products.
"Higher prices in the first half of the year was a factor that appeared to slow demand growth across all major products," API said in its July 20 report. "Highway diesel had the strongest growth of any major refined petroleum product, a continuing trend."
But overall petroleum demand softened in the first half of 2005 following strong growth in 2004, API said.
Total US crude oil inventories were 323 million bbl as of June 30, marking an increase of more than 37 million bbl during the first half of 2005 and 6% higher than a year ago. The increase was more than double the 5-year average rate for January-June, and June's ending level was the highest for that month since 1999.
Slowing demand growth for refined petroleum products during the first half of 2005 showed the "weakest results for a 6-month period since the first half of 2002," API said.
Growth in gasoline deliveries slowed from a 1.9% annual rise in 2004 to less than 0.5% during the first half of 2005. API said this reflected "the consumption-dulling effect of retail gasoline prices at their highest inflation-adjusted level since the early 1980s."
Residual fuel oil deliveries, following double-digit growth in 2004, fell more than 5% compared with the first half of 2004, API said.
"Residual fuel oil prices have risen markedly in recent months, making natural gas more of an economic option for industrial and electric utility users with the ability to use either fuel," API said.
The August contract for benchmark US light, sweet crudes on the New York Mercantile Exchange rose 14¢ to $57.46/bbl on July 19.The September contract climbed 27¢ to $58.69/bbl. On the US spot market, West Texas Intermediate at Cushing, Okla., gained 14¢ to $57.47/bbl.
Heating oil for August declined by 0.015¢ to $1.6301/gal on NYMEX. Gasoline for August gained 0.26¢ to $1.6735/gal.
The August natural gas contract dropped slightly, declining 0.066¢ to $7.586/MMbtu on NYMEX.
In London, the North Sea Brent crude oil contract rose by 37¢ to $57.46/bbl on the International Petroleum Exchange.
The average price for the Organization of Petroleum Exporting Countries' basket of 11 benchmark crudes fell by 48¢ to $51.90/bbl on July 19.