Heating oil sinks in NY

17/07/2009

Wholesale heating oil contracts trading on the New York Mercantile Exchange were down in electronic trading this morning (July 17th), mimicking downward movements seen in crude futures.

By 05:53 Eastern Time, the August delivery contract was trading at $1.5823 (97p) a gallon, down nearly two cents on yesterday's settle price.

Meanwhile crude futures were also moving downward in New York this morning, with concerns about demand stability re-emerging after a flurry of optimistic trading yesterday on the back of positive earnings data from a number of corporate heavyweights in the US.

Andrey Kryuchenkov, an analyst at VTB Capital in London, told Bloomberg that oil is on "shaky ground".

"Fundamentals are bearish in the near term, with demand in the product market depressed. It's going to take dollar weakness and better macro data to restart the uptrend," he predicted.

Despite the weak start today, crude is still on track to finish up this week after three weeks of consecutive declines.