Crude Oil Declines on Wednesday despite decrease in Stockpiles

Crude oil futures declined on Wednesday despite decline in weekly inventories data.  According to latest report of the Energy Information Administration crude oil inventories dropped 2.2 million barrels for the week ended August 19th, 2011 while analyst were hoping oil inventories to gain by 2 million barrels.

According to EIA, gasoline inventories surged 1.4 million barrels for the respective week while analysts were expecting gasoline stockpiles to decrease by 1.4 million barrels. Distillates inventories which include diesel and heating oil also gained 1.7 million barrels whereas analysts expected the increase of 1.3 million barrels.

Crude oil futures contract for October delivery fell 0.3 percent or $0.28 to $85.15 per barrel on Wednesday at New York Mercantile Exchange. The respective contract touched its intraday high of $86.59 per barrel.

London’s Brent crude futures contract for October delivery on the other hand gained 0.8 percent or $0.84 to $110.15 per barrel on ICE Futures Exchange.

Gasoline futures contract for September delivery jumped 0.1 percent or $0.01 to $2.88 per gallon while heating oil futures contract for September delivery surged 0.6 percent or $0.02 to $2.96 per gallon.

According to analysts investors were more concerned over Libya’s situation and news about Nigerian oil. Recently Royal Dutch Shell has reported massive oil spill in Nigeria due to pipeline sabotage. Analysts from J.P. Morgan commented, “This highlights the risks to alternative crude sources for European refiners following the loss of Libyan crude since February. Operators of onshore oil production in Nigeria face ongoing attempts to steal oil, leading to a regular stream of supply interruptions of varying degrees.”

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