New York's Main Oil Futures
Light Sweet Crude Closed at 118.30 Dollars a Barrel
Agence France-Presse 23apr2008
NEW YORK — Oil prices edged higher Wednesday but steadied after failing to top 120 dollars a barrel, as traders digested a mixed report on US stockpiles and growing concerns over soaring energy costs.
New York's main oil futures contract, light sweet crude for delivery in June, rose 23 cents to close at 118.30 dollars a barrel. The May contract had struck a record high 119.90 before expiring on Tuesday.
London's Brent North Sea crude for June delivery rose 51 cents to settle at 116.46 dollars on Wednesday, after hitting an intraday peak of 116.75 on Tuesday.
The US government's Energy Information Administration said Wednesday that American gasoline or petrol reserves sank by 3.2 million barrels in the week ending April 18.
That was steeper than analysts' consensus forecasts for a drop of 2.0 million.
Traders focus on gasoline supplies ahead of the peak demand season that starts in May when many Americans take to their cars for their summer holidays.
However, the EIA added that crude oil stockpiles grew by 2.4 million barrels. That was better than market expectations for a gain of 1.5 million.
"The build in crude was a little higher and the draws in the products were somewhat greater than anticipated," said Citigroup analyst Tim Evans.
Phil Flynn at Alaron Trading said traders hesitated after futures failed to break through the symbolic level of 120 dollars a barrel, easing some speculative fervor.
"After the market had built up all this bullish frenzy it's almost like the price objective of 120 dollars a barrel seemed to matter more than the fundamentals," he said.
Prices had scaled historic heights on Tuesday as an attack on crude pipelines in Nigeria further tightened global energy supplies, which are under intense pressure with crude cartel OPEC declining to raise short-term output.
Additional support came from the weak US currency, which makes dollar-priced oil cheaper for foreign buyers and stimulates demand. The euro surged past 1.60 dollars for the first time on Tuesday.
Global supply worries were also stoked this week after Anglo-Dutch oil group Royal Dutch Shell reported an output loss of 169,000 bpd from sabotage of its key pipelines in southern Nigeria.