Heating oil rises on demand expectations

20 April 2010

Written by Kim Bardsley

Heating oil futures traded higher on the New York Mercantile Exchange this morning (April 20th), bolstered by expectations of recovering demand.

A poll conducted by Bloomberg revealed median expectations that the Energy Information Administration's demand report for last week will show a 600,000-barrel decline in crude inventories.

Last week, crude stocks declined for the first time in 11 weeks, leading to a surge in buying activity that pushed oil prices above $86 a barrel.

However, in late trading last week and yesterday, the commodity slumped to a three-week low below $82 (€60.90) a barrel, weighed down by the grounding of flights across much of Europe and the commencement of legal proceedings against Goldman Sachs for alleged fraud.

Speaking to Bloomberg, David Moore, a commodities strategist at Commonwealth Bank of Australia in Sydney, commented: "The market ran a little hard on the downside … Oil has come back quite a bit."

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