Heating oil down further in morning trade

7 July 2010

Written by Kim Bardsley

Heating oil prices were down on the New York Mercantile Exchange this morning (July 7th) as crude prices fell for a seventh consecutive day.

Although there was a brief rally in both commodities at the beginning of trade on speculation that fuel demand is improving, concerns about stability in the US, China and Europe continued to curb bullish trading.

By the time European markets opened, heating oil prices had slipped into negative territory and were trading around $1.911 a gallon, down a fraction of a cent. Crude oil prices were also lower, trading below $72 a barrel once more after a brief rally.

"The market is pricing in a drop in crude inventories, but if inventories fall less than expected, we might see prices falling," commented Serene Lim, a Singapore-based oil analyst with ANZ, speaking to Reuters.

Fuel inventories data for the US will be released by the Energy Information Administration later today and are expected to detail declines in crude stocks, driven in large part by heightened seasonal demand for gasoline.