Heating oil pares losses

24/02/2009

Heating oil is recovering from losses during trading yesterday (February 23rd) during early activity on the New York Mercantile Exchange.

By 6:01 Eastern Time, heating oil for March delivery had risen to $1.181 (76.89p) a gallon, up 0.5 cents on its opening price.

Heating oil took substantial losses yesterday amid speculation that President Obama may be forced to nationalise parts of the US financial industry after the announcement that it will be taking on a larger stake in CitiGroup.

Meanwhile, there is also ongoing concern that demand for crude and distillates such as heating oil may fall further than cuts enacted by the Organisation of the Petroleum Exporting Countries (Opec) can account for.

Speaking to Bloomberg, Christopher Edmonds, the managing principal of FIG Partners Energy Research & Capital Group, said: "Opec is being fairly diligent in meeting its production target but people are focused on the economy. We need to have a better idea of what the recovery plan will look like."