US crude oil futures for August delivery dropped modestly on June 24 after analysts were surprised by a weekly increase in product inventories, especially gasoline supplies.
The US Energy Information Administration said commercial crude oil inventories, excluding the Strategic Petroleum Reserve, decreased 4.9 million bbl for the week ended June 19 from the previous week.
The report showed refineries ran at near-maximum capacity last week, drawing down on crude inventories although the brisk refinery activity resulted in increased fuel products.
“The market seems to be shifting crude oil from inventory into refined products inventory,” said Dominick Chirichella, an analyst with the Energy Management Institute. “Market sentiment remains mixed and slightly biased to the downside.”
On June 25, EIA reported natural gas in underground storage across the Lower 48 was 2.5 tcf as of June 19, which marked a net increase of 75 bcf from the previous week.
Stocks were 695 bcf higher than last year at this time and 35 bcf above the 5-year average of 2.47 tcf, the weekly Gas Storage Report said.
The natural gas contract for July was up 3¢ to a rounded $2.76/MMbtu. The Henry Hub, La., gas price was down 6¢ to $2.77/MMbtu.
Heating oil for July dropped 3.5¢ to a rounded $1.88/gal. The price for reformulated gasoline stock for oxygenates blending for July was down 2¢ to a rounded $2.05/gal.
The August ICE contract for Brent crude was down 96¢ to $63.49/bbl while the September contract was down 97¢ to $64.16/bbl. The ICE gas oil contract for July was down $2.25 to $581/tonne.
The average price for the Organization of Petroleum Exporting Countries’ basket of 12 benchmark crudes for June 24 was $60.68/bbl, up 72¢.
Contact Paula Dittrick at firstname.lastname@example.org.
*Paula Dittrick is editor of OGJ’s Unconventional Oil & Gas Report.