Heating oil flat, clinging to sharp gains

14 July 2010

Written by John King

Heating oil prices were holding steady on the New York Mercantile Exchange this morning (July 14th), resilient after impressive gains yesterday.

At the close of trading yesterday, the August-delivery heating oil contract had climbed more than five cents to trade at $2.0598 a gallon, and it has deviated from this price only slightly in trading this morning.

The commodity traded in line with crude futures yesterday, with both assets climbing after a strong start to the US corporate earnings season.

"Oil pricing has been handcuffed to equities so the strong performance in US equities yesterday had a lot to do with the rally," said Victor Shum, a senior principal at Purvin & Gertz in Singapore, speaking to Bloomberg.

He added that prices will continue to be dictated by earnings data in the near-term.

A Bloomberg survey also revealed a consensus that crude inventories fell in the US last week, adding to the case for higher prices.