Market watch: Adequate US gasoline stocks undermine energy futures prices
By OGJ editors
HOUSTON, May 29 -- Adequate US supplies of gasoline at the start of the summer driving season drove down energy futures prices Tuesday on the New York Mercantile Exchange.
The June contract for unleaded gasoline plummeted 3.16¢ to 75.85¢/gal in a market where prices changes usually are measured in fractions of a penny.
Concerns that a possible rupture of the 6-month cooperative effort between the Organization of Petroleum Exporting Countries and non-member producers might pump more oil into world markets also contributed to the downturn. The July contract for benchmark US sweet, light crudes dropped 61¢ to $25.27/bbl on NYMEX. The August position also lost 55¢ to $25.43/bbl. Both continued their downward slide to $24.93/bbl and $25.13/bbl, respectively, in after-hours electronic trading.
Heating oil for June delivery fell 1.96¢ to 63.99¢/gal. Natural gas for the same month retreated 6.7¢ to $3.28/Mcf.
In London, futures prices for North Sea Brent oil closed lower on the International Petroleum Exchange in anticipation of yet another bearish report of US petroleum inventories Wednesday by the American Petroleum Institute. API generally issues that weekly report on Tuesdays, but this week's survey was delayed by the Memorial Day holiday Monday.
The July Brent contract lost 18¢ to $24.76/bbl Tuesday. Brokers said the market had already absorbed reports of Russia's anticipated production increase at the end of June. However, it is not yet clear where the market might stabilize, they said.
The June natural gas contract dipped by 0.29¢ to the equivalent of 41.76/Mcf on the IPE.
The average price for OPEC's basket of seven benchmark crudes dropped 20¢ to $23.82/bbl Tuesday.