GO
Loading...

Enter multiple symbols separated by commas

Oil Loses 2% on Profit Taking; Refinery Issues Prop up Gasoline

Crude oil futures fell more than a dollar as traders took profits ahead of fresh oil inventory data due Wednesday and following Monday's sharp price rise on worries about supply disruptions in the wake of Nigeria's disputed presidential election.

On the New York Mercantile Exchange June crude dropped $1.31 or 2% to settle at $64.58, trading from $64.10 to $66.30.

In London, June Brent crude was also down more than $1, well off session highs of $68.55.

"It looks like profit-taking, from my vantage point," said Jim Ritterbusch, president of Ritterbusch & Associates, in Galena, Ill.

"We're seeing retracement of strong gains yesterday," said Antoine Halff, head of energy research at Fimat USA.

Oil jumped on Monday after Nigeria's ruling party's candidate Umaru Yar' Adua was declared the winner of the presidential poll. Observers and opposition groups said the result was manipulated through violence and rigging.

Analysts raised concerns over the potential for more violence against the oil industry, which has already curbed about 20% of the OPEC nation's total output.

"The fear of renewed supply disruption is prompting traders to buy first and ask questions later," said Olivier Jakob of Swiss-based oil consultants Petromatrix.

U.S. prices have been pressured by a glut of crude in the Midwest, creating an unusual discount to Brent oil. A string of refinery problems in the region could lower demand and help
build stocks further

Refinery snags and inventory concerns kept refined products supported.

NYMEX May RBOB gasoline settled up 1.82 cents or 0.8% at $2.2089, trading $2.1689 to $2.2449.

NYMEX May heating oil lost 4.83 cents or 2.6% to settle at $1.8460, trading $1.8391 to $1.8968.

Full production may not resume for months at BP's Whiting, Indiana, refinery, a BP source said today.

Production at the 420,000-barrel-per-day refinery has been cut to around 200,000 bpd due to operational issues, BP said in a statement.

A new snapshot of U.S. inventories will be available Wednesday morning from the U.S. Energy Information Administration's weekly report.

A Reuters analyst poll on Monday yielded a forecast that crude oil supplies dipped 400,000 barrels last week. Gasoline inventories were expected to be down 100,000 barrels and distillate supply up 500,000 barrels.

Refinery capacity use was expected to be up 0.5 percentage point, contributing to the crude supply dip and after having risen 2.0 percentage points in the previous week as refineries
return from seasonal maintenance.

Contact U.S. News

  • CNBC NEWSLETTERS

    Get the best of CNBC in your inbox

    Please choose a subscription

    Please enter a valid email address
    To learn more about how we use your information,
    please read our Privacy Policy.

Don't Miss

  • Oreo Thins

    Oreos are getting a skinny new look, and its maker says the new cookie is a "sophisticated" snack for grown-ups that isn't meant to be twisted or dunked.

  • Home outdoor shower

    Some projects make more sense to do yourself while others are better left to the experts.

  • Ellen Pao, former junior partner at Kleiner Perkins Caufield & Byers and current CEO of Reddit, arrives at state court in San Francisco in March

    A petition calling for Reddit CEO Ellen Pao to step down has been signed by over 14,000 people who feel she is destroying Reddit.

U.S. Video

  • Health care's urge to merge

    Discussing merger deals in the health care industry, and the impact it could have on patients, with Dr. Scott Gottlieb, AEI Resident Fellow.

  • Innovative investing with Burton Malkiel

    Wealthfront chief investment officer Burton Malkiel of Princeton University, discusses the company's service that is lowering the barrier to entry for investors.

  • The kind of contagion I worry about: El-Erian

    Discussing negotiations on Greece's debt, and the future for the economy there, with Mohamed El-Erian, Allianz Chief Economic Adviser and Former PIMCO CEO.