OGJ Senior Staff Writer
HOUSTON, July 30 -- US crude oil futures prices plummeted July 29 upon a government report of rising crude oil inventories. Analysts said higher inventory numbers caused them to worry about weakening oil demand.
“Oil prices took a trouncing,” Barclays Capital analysts said. The US Energy Information Administration reported a build of 5.1 million bbl in commercial inventories of benchmark crude oil.
The higher inventory figures were released “against a backdrop of weak macroeconomic data and regulatory uncertainties,” Barclays Capital said. Gary Gensler, chairman of the Commodity Futures Trading Commission, suggested imposing limits on speculative trading.
Barclays Capital analysts believe energy commodity prices could drop some more.
“There is a risk for yet another dislocation at the front end” of the West Texas Intermediate crude contract on the New York Mercantile Exchange, they said in a July 30 research note.
The September contract for benchmark US sweet, light crudes fell $3.88 to $63.35/bbl July 29 on the NYMEX. It was the biggest decline during a day’s trading session since Apr. 20. The October contract for sweet, light crudes also dropped sharply, down $3.75 to $65.23/bbl.
On the US spot market, WTI at Cushing, Okla., was down $3.88 to $63.35/bbl. Heating oil for August delivery decreased 9.3¢ to $1.67/gal on NYMEX. Reformulated blend stock for oxygenate blending (RBOB) for the same month was down 5.5¢ to $1.85/gal.
The August natural gas contract dropped 15.6¢ to $3.38/MMbtu on NYMEX, marking the contract’s lowest settle price in 10 days. On the US spot market, gas at Henry Hub, La., declined by 11¢ to $3.365/MMbtu.
In London, the September IPE contract for North Sea Brent crude dropped $3.35 to $66.53/bbl. August gas oil lost $21.75 to $543/tonne.
The average price for the Organization of Petroleum Exporting Countries' basket of 12 reference crudes was down $2.64 to $65.81/bbl on July 29.
Contact Paula Dittrick at firstname.lastname@example.org.
MARKET WATCH: Crude oil futures dip upon growing US inventory