SINGAPORE, (AP) -Oil prices retreated in Asian trading Thursday following a report showing that U.S. oil refineries were accelerating gasoline production ahead of the summer driving season.
Light, sweet crude for May delivery declined 37 cents to $62.76 a barrel in electronic trading on the New York Mercantile Exchange mid-afternoon in Singapore.
The contract, which expires Friday, settled 3 cents higher at $63.13 a barrel Wednesday after a rally from earlier losses.
Brent crude contract for June delivery fell 2 cents to $66.02 a barrel on the ICE Futures exchange in London.
U.S. refineries boosted their operation by 2 percentage in the week ended April 13, the U.S. Department of Energy said in its weekly inventory report, above expectations of a 0.4 percentage rise.
The report also showed U.S. gasoline inventories fall by 2.7 million barrels, more than analysts’ average forecast for 1.5 million barrel decline, according to a survey by Dow Jones Newswires, causing gasoline futures to rise by more than $2 Wednesday.
“Looks like the gasoline demand started sooner than normal and the refineries hadn’t switched over quite as efficiently as one would have hoped, so that’s why gasoline prices rose and we saw that impact lead into crude,” said Andrew Harrington, an analyst with ANZ Global Natural Resources in Sydney.
Crude oil stocks, meanwhile, fell by a million barrels to 332.4 million barrels — countering expectations for an increase of 500,000 barrels.
The market was also watching mixed signals from Nigeria.
“So far the legislative election which happened over last weekend had fairly impact on the oil market,” said Harrington. “There was violence in the street but there wasn’t direct violence against oil exports that fed into the price.”
Civil strife continued throughout the country ahead of this weekend’s presidential elections. But the country’s oil minister announced a major oil field could come back online by the end of May.
“It still remains an area of focus, there’s just a potential there,” Harrington added.
Nigeria is the world’s eighth-largest oil exporter and a main supplier to the United States. Nigerians vote Saturday in presidential elections, a week after at least 21 were killed in violence surrounding state elections.
In other Nymex trading, heating oil futures remained unchanged at $1.8066 a gallon while natural gas prices gained 1.7 cents to $7.514 per 1,000 cubic feet.