NEW YORK—Crude futures were up slightly Thursday morning as expectations for a drop in U.S. oil inventories prevented uncertainty about the economic outlook from pressuring prices lower.
Light, sweet crude for March delivery traded 16 cents, or 0.2%, higher at $77.90 a barrel on the New York Mercantile Exchange. The February contract expired Wednesday at $77.62 a barrel. Brent crude on the ICE futures exchange traded 14 cents higher at $76.46 a barrel.
Oil prices are holding up against a bevy of forces that would on other days have pushed futures to new lows for the year. The economic outlook in the U.S. and China, the two largest oil consumers, has dimmed this week, with China moving to tighten lending on Wednesday and new U.S. unemployment claims unexpectedly rising on Thursday.
Strong economic growth and rising energy demand in both countries are seen as essential to reducing global crude and fuel inventories this year, justifying $80-a-barrel oil.
But futures held firm, and have so far avoided dropping below $77 a barrel for a third consecutive session.
"We've had a lot of bearish news thrown at this market, and we're not seeing...a mass exodus," said Jim Ritterbusch, president of the trading advisory firm Ritterbusch & Assoc. in Galena, Ill.
One source of support is coming from the looming release of U.S. oil and fuel stockpile data from the Energy Information Administration later Thursday. Expectations are for oil inventories to rise 1.9 million barrels, but data put out Wednesday by the American Petroleum Institute, an industry group, showed a 1.8-million-barrel drop last week.
Gasoline stocks rose 700,000 barrels, less than the 1.3 million barrels expected in a Dow Jones survey, while distillate inventories, including heating oil and diesel, declined 3.4 million barrels, far exceeding the average forecasted 200,000-barrel drop.
Mr. Ritterbusch said the market is pricing in a sharp drop in refinery activity, which could crimp gasoline supplies heading into the spring and summer, when demand typically rises.
Front-month February reformulated gasoline blendstock, or RBOB, recently traded 80 points, or 0.4%, higher at $2.0545 a gallon. February heating oil traded 29 points, or 0.1%, higher at $2.0240 a gallon.
A fire at an oil storage facility in Cushing, Okla., the delivery point for the Nymex contract, didn't appear to affect prices. The fire, which was extinguished earlier Thursday, was isolated to one tank and affected a small amount of crude, according to Pete Schwiering, president of SemCrude, a division of SemGroup Corp., which operates the tank.
