MARKET WATCH: Oil prices down on weak US January product demand

Crude oil prices continued to slide Apr. 4 after the release of a US government report detailing lower demand for petroleum products. The lower demand, mostly shown in weaker demand for distillates, was attributed to warmer-than-average weather.

On Apr. 4, the US Department of Energy released the Petroleum Supply Monthly for January which showed total oil product demand fell 2.5% in January to 19.1 million b/d vs. December 2015. Also, demand in January was estimated to be down slightly—about 196,000 b/d—vs. January 2015. Weak distillate demand drove the overall decline, observed analysts at Raymond James & Associates Inc.

The May crude oil contract on the New York Mercantile Exchange fell $1.09 to $35.70/bbl on Apr. 4. The June contract fell $1.17, settling at $37.03/bbl.

The NYMEX natural gas contract for May was up 4¢ to nearly $2/MMbtu.

Heating oil for May delivery was down 4.28¢ to a rounded $1.09/gal. The price for reformulated gasoline stock for oxygenates blending for May declined 2.46¢ to a rounded $1.38/gal.

The Brent crude contract for June on London’s ICE decreased 98¢ to $37.69/bbl. The July contract declined $1.11 to $37.98/bbl.

The average price for the Organization of Petroleum Exporting Countries’ basket of 13 benchmark crudes on Apr. 4 was $33.33/bbl, rising down $1.14.

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