Oil climbs towards $68 ahead of US gasoline data

LONDON - Oil rose towards $68 a barrel on Wednesday before weekly US data that is expected to show an 11th straight drop in gasoline stocks ahead of peak summer demand in the world’s top consumer.

By (Reuters)

Published: Wed 25 Apr 2007, 6:33 PM

Last updated: Sat 4 Apr 2015, 9:17 PM

London Brent crude, for now seen as a more accurate reflection of world oil prices than US crude, rose 67 cents to $67.83 at 1131 GMT after a 99-cent drop the day before.

US crude was up 41 cents at $64.99.

“US refineries are ramping up ... but the feeling is they are not going to keep up with demand,” said Mark Waggoner, president of Excel Futures in Huntington Beach, California.

US gasoline stocks are expected to have slipped by 400,000 barrels, according to a Reuters poll of industry analysts, deepening a 13-percent slide in stock levels since early February amid refinery outages.

“Gasoline has led the market for months, but that should start to change as refiners come out of turnarounds, product balances start to loosen and crude begins to tighten,” said Mike Wittner of investment bank Calyon.

He said prices had also been pushed higher by concern about instability in oil producer Nigeria, where violence has surged following weekend elections that observers say were rigged.

“Nigeria is a tough call right now,” said Wittner. “The market’s view was that production outages would be restored gradually after the election. But that assumption needs to be questioned.”

Nigeria has lost 600,000 barrels per day (bpd) in oil production since the rebel Movement for the Emancipation of the Niger Delta (MEND) attacked oilfields in the western Delta in February 2006.

But Nigerian officials say oilfields pumping more than half that volume will be restarted by the end of May.

The dispute between the West and OPEC producer Iran over its nuclear programme offered further support.

The EU and Teheran are to discuss on Wednesday whether the Islamic republic might be prepared to suspend nuclear activity after more sanctions were imposed.

Iran has vowed not to retreat despite world pressure.

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