Market watch: Gasoline pulls down crude futures
By OGJ editors
HOUSTON, July 15 -- Oil futures prices closed moderately lower in trading on the New York Mercantile Exchange Thursday, and traders said crude oil prices were dragged down by a selloff in gasoline futures.
Trading volumes were heaviest for gasoline futures as traders locked in their profits after the product's rise of the last two weeks. But on Thursday, gasoline prices took a downward direction on news of the restart of a California refinery.
The August contract for benchmark US light, sweet crudes dropped by 31¢ to $27.57/bbl Thursday on NYMEX, while the September position dropped by 35¢ to $27.66/bbl.
Unleaded gasoline for August delivery declined by 1.49¢ to 83.35¢/gal in the wake of reports that Phillips Petroleum Co. had completed the restart of its 115,000 b/d refinery in Rodeo, Calif.
The refinery had been shut down unexpectedly for a week because of mechanical problems, prompting additional concerns about summer gasoline supplies.
Gasoline prices rebounded somewhat in the afternoon upon news that workers at Conoco Inc.'s Westlake refinery in Lake Charles, La., might strike on Friday because of a breakdown of contract negotiations Thursday.
Conoco has said it has a contingency plan to continue operating the refinery if the strike does happen.
Meanwhile, heating oil for August slipped by 0.80¢ to 70.18¢/gal. The August natural gas contract rose, up 10.2¢ to $2.94/Mcf.
In London, the September North Sea Brent oil contract fell by 16¢ to $26.28/bbl Thursday on the International Petroleum Exchange. However, the August natural gas contract held unchanged from the previous day at the equivalent of $1.97/Mcf.
The average price for OPEC's basket of seven crudes dropped 12¢ to $25.85/bbl Thursday.