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Oil Pops as Refinery Outage Provides Selling Relief

Friday, 24 May 2013 | 2:50 PM ET
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Oil prices rose in late afternoon trading in New York on Friday after a report of a gasoline unit shutdown at a refinery, and as traders bought contracts to cover short positions ahead of a long holiday weekend in the United States.

Brent reversed early losses to trade up 14 cents above $102 after trading between $101.65 and $102.75.

U.S. July oil futures fell 27 cents to trade around $94 a barrel after trading between $93.04 and $94.39.

Genscape said it detected the shutdown of the 70,000 barrel per day fluid catalytic cracker at Irving Oil's 300,000 bpd refinery in St. John's, Canada.

Gasoline futures rose on the news and were last trading at $2.8399 per gallon, up 0.42 percent, after trading at a low of $2.80.

"Initially, we thought it (the rise in prices) was just a shakeup north of border," said one New York-based broker. "But now, we're seeing short covering in front of the weekend."

Total oil trading volumes were around 60 percent lower on Friday afternoon versus the 30-day moving average ahead of the Memorial Day holiday on Monday as traders and brokers left early.

Earlier in the day, oil futures prices were trading as much as a $1 per barrel lower, as high U.S. supplies, questionable demand out of China and worries that the Federal Reserve could soon scale back bond purchases weighed on prices.

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