SINGAPORE, (AP) – Oil prices climbed in Asian trading Wednesday amid expectations that the weekly U.S. oil inventory snapshot will show a drop in domestic supplies of gasoline and distillates such as heating oil.
Gasoline prices have risen lately as traders anticipated an increase in gasoline demand in the approaching U.S. summer driving season, coupled with low stocks amid refinery outages in the United States, the world’s largest oil consumer.
“Even though the official start is still two months away, (gasoline) prices hit a seven-month high (Monday). Gasoline inventories have fallen about 6 percent since early February, and are expected to fall further,” said John Kilduff of Fimat USA, in an overnight note to clients.
Light, sweet crude for May delivery gained 25 cents to $59.50 a barrel in Asian electronic trading on the New York Mercantile Exchange mid-afternoon in Singapore. Japanese traders were off for a national holiday.
The May contract earlier fell 45 cents to close at $59.25 a barrel Tuesday.
Brent crude contract for May delivery rose 23 cents to $60.43 a barrel on the ICE Futures exchange in London.
Analysts polled by Dow Jones Newswires estimated the U.S. Energy Department report due later Wednesday to show, on average, a build of 1.4 million barrels in crude oil stocks. But gasoline inventories were likely to decline by 1.6 million barrels, and distillate supplies — which include heating oil and diesel fuel — were expected to fall by 1.1 million barrels.
The London-based Center for Global Energy Studies, an international energy group, has warned that oil prices would spike in the summer if the Organization of Petroleum Exporting Countries does not increase output. In a report released Monday, it urged OPEC to raise output so refiners have enough crude.
Late last year, OPEC member nations pledged to shore up falling oil prices by reducing their oil output by 1.7 million barrels a day. The group decided last week to maintain present production targets at its meeting in Vienna.
In other Nymex trading, heating oil futures for April rose 0.17 cents to $1.6704 a gallon while natural gas prices gained 1.5 cents to $6.925 per 1,000 cubic feet.