Heating oil recovering on Nymex

25/06/2009

Heating oil prices were recovering on the New York Mercantile Exchange this morning (June 25th) after skidding on weak demand data published yesterday.

By 05:17 Eastern Time, the July delivery heating oil contract was trading at $1.7606 (£1.08) a gallon, up 2.25 cents on yesterday's closing price.

The Energy Information Administration announced that inventories of distillates such as heating oil had risen 2.1 million barrels by Friday (June 19th), while gasoline and propane stocks also rose.

However, the weak demand indicators were partially offset by a larger than anticipated drop in crude inventories.

Speaking to Bloomberg, Ken Hasegawa, a commodity derivatives sales manager at brokers Newedge in Tokyo, said that on balance, the data were not indicative of a recovery in petroleum demand.

"There is a lot of pressure coming into the market. The market is finding a bottom and it may try to go down to test $65," he said.