In face of the highest crude and distillate stockpiles since the early 1980’s, the oil market has still continued to gain strength over recent sessions. Crude oil has reached a new high for 2009, Nymex front month light sweet crude futures rose more than 1% today to trade above $75.00 per barrel.
The rally has largely been sentiment based with more than a little help from the persistently weak US Dollar. Both the International Energy Agency (IEA) and the Organization of Petroleum Exporting Countries (OPEC) have upgraded their demand outlook.
Some analysts and market commentators have pointed to the potential for a better-than-expected seasonal increase in demand in the run up to the Christmas holidays. The apparent progress of the economic recovery has led to heightened expectations of crude oil and gasoline consumption into the year end.
Against the backdrop of the largest US Crude stockpiles since the early nineteen eighties, investors will now look to the US over-supply issues again to gauge what impact the increased demand is likely to have. This week the two key inventory reports from the American Petroleum Institute and the US Department of Energy will be a key highlight in the crude oil market. The report’s come a day late after the Columbus Day public holiday.
Crude Oil stockpiles are expected to fall while some analysts anticipate a rise in distillates and gasoline inventories.
On Wall Street trading has been fairly strong, Oil & Gas majors were generally higher as Exxon Mobil (NYSE: XOM) and Chevron (NYSE: CVX) both rose over 1%
French Oil & Gas producer Total SA (NYSE:TOT) was the top performer on Wall Street gaining more than 3%, trading at $62.41.Meanwhile Canada based multinational operator EnCana (NYSE:ECA & TSX: ECA) and Murphy Oil Corp (NYSE: MUR) both advanced 1½%.
ConocoPhillips (NYSE:COP) was relatively unchanged this morning dropping just 2 pence per share.