FU: Crude oil retreats from 26-month high ahead of Christmas break
Futures Pros – Crude oil futures snapped four days of gains on Thursday amid thin volumes ahead of the Christmas break, as investors looked to lock in profits from a rally that saw prices hit a 26-month high.
On the New York Mercantile Exchange, light sweet crude futures for delivery in February traded at USD 90.61 a barrel during European morning trade, slumping 0.06%.
It earlier rose to USD 90.76 a barrel, just below Wednesday’s 26-month high of USD 90.78 a barrel.
On Wednesday, crude oil prices for February delivery soared to the highest price since October 7, 2008, sparking some profit taking from traders ahead of the year’s end.
Meanwhile, forecasts of frigid weather in the U.S. limited losses after weather service provider AccuWeather said that it expected temperatures in the U.S. Northeast to average mostly below normal for the next week.
The U.S. National Weather Service said earlier in the week that U.S. heating oil demand was expected to be 4.6% above average for the week ending December 25. It was 19.6% above normal in the preceding week.
The U.S. East Coast is the largest heating oil market in the U.S. One barrel of crude oil produces approximately 42 gallons of heating oil.
Meanwhile, official data released Wednesday by the U.S. Energy Information Administration showed that U.S. crude oil inventories fell significantly more-than-expected in the week ended December 17, decreasing by 5.3 million barrels. Analysts had expected U.S. crude oil inventories to fall by 1.1 million barrels.
The report also showed that stocks of distillate fuels, including heating oil and diesel decreased by 0.6 million barrels in the week ended December 17.
The data also indicated that demand for crude oil was increasing. Total crude oil products supplied over the last four-week period has averaged 19.7 million barrels per day, up by 4.1% compared to the similar period last year.
Elsewhere, natural gas for January delivery tumbled 1.05% to trade at USD 4.082 per million British thermal units, while heating oil for January delivery dipped 0.15% to trade at 2.526 per gallon during European morning trade.
