WTI Crude Trades Near Week Low on U.S. Stockpiles

West Texas Intermediate traded near the lowest price in more than a week before a government report forecast to show U.S. crude stockpiles gained for a sixth week in the world’s biggest oil consumer. Brent was stable in London. Futures were little changed in New York after losing 1 percent yesterday, the most since Feb. 3. Crude inventories probably rose by 1.275 million barrels last week, according to a Bloomberg News survey of analysts before Energy Information Administration data today. Prices have climbed more than 4 percent this month, reaching as high as $103.80 a barrel, as colder weather boosted energy demand and supplies declined at Cushing, Oklahoma, the largest U.S. oil-storage hub. “If there’s an increase in U.S. crude inventories, that could certainly have an impact on prices,” said Hans van Cleef, an energy economist at ABN Amro Bank NV in Amsterdam. “Every time WTI touches levels above $103 a barrel, people start to get nervous about long positions and at some point you see profit-taking. WTI can drop below $100 and the spread against Brent can widen somewhat.” WTI for April delivery was 13 cents higher at $101.96 a barrel in electronic trading on the New York Mercantile Exchange as of 8:40 a.m. London time. The contract dropped to $101.83 yesterday, the lowest settlement since Feb. 14. The volume of all futures traded was 12 percent below the 100-day average. Brent for April settlement gained 7 cents to $109.58 a barrel on the ICE Futures Europe exchange. The European benchmark crude was at a premium of $7.63 to WTI on ICE. The spread closed at $7.68 yesterday, narrowing for the first time in three days.

Cushing Stockpiles

WTI advanced in the six weeks through Feb. 21, the longest rising streak in a year, as winter storms bolstered heating demand in the U.S. and inventories shrank at Cushing, the delivery point for New York-traded contracts. Crude stockpiles at the storage hub fell by 1.07 million barrels in the week ended Feb. 21, theAmerican Petroleum Institute reported yesterday. Supplies nationwide expanded by 822,000 barrels, said the industry group in Washington. “We need to care more about inventories in Cushing than total crude-oil stocks,” said Ken Hasegawa, an energy trading manager at Newedge Group in Tokyo. “If Cushing inventories decrease, it’s going to be a positive factor for WTI.” Distillate stockpiles, including heating oil and diesel, declined by 693,000 barrels, the API data showed. Supplies probably dropped by 1.25 million barrels, according to the median estimate of 10 analysts surveyed by Bloomberg before the report from the EIA, the Energy Department’s statistical arm. The API collects stockpile information on a voluntary basis from operators of refineries, bulk terminals and pipelines. The government requires that reports be filed with the EIA for its weekly survey. Source :   http://www.bloomberg.com/news/2014-02-26/wti-oil-advances-from-one-week-low-as-cushing-supplies-decline.html