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Petroleum

Crude and Gasoline Prices Rise on Bullish Inventory Data, But Technical Resistance Cautions Optimism

Strategic Insights

— 1 min read

Oil prices surged on Wednesday due to bullish inventory statistics, with the December crude contract on the New York Mercantile Exchange (Nymex) settling up 11 cents at $17.93/bbl ahead of its expiration. However, technical resistance and caution from traders limited the gains. Crude stocks last week were 36.18 million bbl down on year-ago levels, according to the American Petroleum Institute (API). Some sources forecast that $18/bbl will be a significant hurdle for crude prices, and the market is unlikely to make a decisive move until after the upcoming OPEC meeting. Meanwhile, gasoline prices found support in a surprisingly large inventory draw, but modest gains were seen as a disappointment.

Key Takeaways:

  • Bullish inventory statistics propelled crude and gasoline prices higher on Nymex, with the December crude contract settling up 11 cents at $17.93/bbl.
  • Crude stocks last week were 36.18 million bbl down on year-ago levels, according to the American Petroleum Institute (API).
  • $18/bbl is forecasted to be a significant technical hurdle for crude prices, and the market may not act decisively until after the upcoming OPEC meeting.
  • Gasoline prices found support in a surprisingly large inventory draw, but modest gains were seen as a disappointment.
  • Analyst Timothy P. Evans forecasted a 35% chance of a moderate sell-off and a 25% chance of a sharp sell-off to less than $17/bbl.
  • Analyst Alan H. Levine stated that the market is "very vulnerable" to supply disruptions, but prices are unlikely to do much until after the OPEC meeting.

Statistics:

  • December crude contract on Nymex settled up 11 cents at $17.93/bbl.
  • Crude stocks last week were 36.18 million bbl down on year-ago levels, according to the American Petroleum Institute (API).
  • December gasoline contract settled up 0.81 cents at 51.24 cents/gallon.
  • API reported that gasoline inventories reached 24-year lows.
  • Analyst Timothy P. Evans forecasted a 35% chance of a moderate sell-off and a 25% chance of a sharp sell-off to less than $17/bbl.

Sources:

  • Source 1: "Bullish Inventory Stats Lift Oil Prices, But Technical Resistance Gives Markets Pause" (Date not provided).
  • Source 2: American Petroleum Institute (API).
  • Source 3: Interview with analyst Timothy P. Evans.
  • Source 4: Interview with analyst Alan H. Levine.

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