Heating oil down again in morning session

13 April 2010

Written by Neil Brunskill

Heating oil prices moved lower on the New York Mercantile Exchange this morning (April 12th) on the commonly held assumption that upcoming inventory reports will show further weakness in demand for the commodities.

Both the American Petroleum Institute and the Energy Information Administration (EIA) are expected to show a further slump in demand in weekly inventory reports due to be published later today and tomorrow.

Analysts polled by Bloomberg expected the EIA to show a 1.15 million-barrel build in crude inventories for last week, marking the 11th consecutive supply build.

In previous weeks, the demand reports have taken the momentum out of early price gains in both heating oil and crude, and analysts expect the same to happen this week.

"People may be sceptical as to whether oil at $85 a barrel-plus is justified given current market fundamentals," said David Moore, commodity strategist at Commonwealth Bank of Australia in Sydney, speaking to Bloomberg.

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