SINGAPORE, (AP) -Oil futures declined Thursday following the release of a U.S. weekly petroleum supply snapshot that showed an increase in inventories of gasoline and distillate fuels, which include heating oil, but a bigger-than-expected drop in crude stocks.
Light, sweet crude for February delivery fell 41 cents to $63.31 a barrel in Asian electronic trading on the New York Mercantile Exchange mid-afternoon in Singapore.
February Brent crude at London’s ICE Futures exchange slipped 35 cents to $62.88 a barrel.
The Nymex crude contract rose 26 cents Wednesday to settle at $63.72 a barrel — a three-month closing high — after the U.S. Department of Energy said that crude inventories plunged by 6.3 million barrels last week from the previous week.
That was much lower than analysts’ expectations of a drop between 1.8 million barrels and 2 million barrels.
However, there were expectations that stocks will rebound once fog lifts in the U.S. Gulf Coast region and shipping there returns to normal.
Since Monday, Dec. 11, the Gulf Coast region has been engulfed in dense fog, which has significantly disrupted shipments in and out of the ports, according to the Port of Houston Authority. Weather reports forecast that the fog should move out by Tuesday.
Meanwhile, motor gasoline inventories posted an increase last week, rising by 1 million barrels but still lower than average.
Inventories of distillate fuels, which include heating oil and diesel fuel, also rose last week by 1.2 million barrels and are at average levels for this time of year. Heating oil futures dropped marginally to $1.7290 per gallon.
Crude has been trading between $60 and $64 a barrel since the end of November.
Prices rose $1.41 a barrel last week, mostly because OPEC agreed to cut production by 500,000 barrels a day starting in February. That cut came after the cartel said in October that it would remove 1.2 million barrels a day of production from the market.
While traders were initially skeptical of OPEC’s ability to get members to comply with the October cut, a drop in production from most of the cartel’s 11 members has given more weight to the last decision.
In other Nymex trading, natural gas prices rose 1.5 cents to $6.784 per 1,000 cubic feet.