Crude Leaps After EIA Data in Choppy Trade

Getty Images

Crude oil futures rebounded from early losses to move higher in afternoon trading in New York on Thursday in reaction to government data that indicated increased U.S. demand for gasoline at the kick-off of summer driving season.

Gasoline stocks fell by 1.5 million barrels in the week that ended on Friday, with the bulk of the drop in the densely-populated East Coast, the data showed.

Stronger gasoline futures led the crude complex higher even as U.S. Energy Information Administration (EIA) data showed record high stocks of crude oil, analysts and brokers said.

"The build in crude was already in the market but the draw in gasoline helped," said Gene McGillian, an analyst with Tradition Energy in Stamford, Connecticut.

U.S. crude stocks rose by 3.0 million barrels last week to their highest on record at 397.55 million barrels.

Brent crude initially rose in the wake of the data, but fell in mid-afternoon trading by 20 cents to steady above $102 a barrel, after falling earlier by as much as $1.35 a barrel. U.S. oil gained 50 cents to trade shy of $94, after falling to $91.65 a barrel earlier.

Gasoline futures traded as high as $2.824 per gallon, after trading as low as $2.757, their lowest level since May 2.

The dollar was at a three-week low against the euro. A lower dollar makes commodities cheaper for traders in other currencies.

But weak U.S. economic data coupled with the fear that the Federal Reserve could ease up on its bond buying program, seen as supporting the economy, limited gains.

Initial jobless claims unexpectedly rose last week.

Friday's meeting in Vienna of the Organization of the Petroleum Exporting Countries was also on traders' radar though few were expecting "a bullish surprise" from the meeting, said Olivier Jakob, an analyst at Petromatrix