Heating oil erases Tuesday's gains

22/07/2009

Investors involved in electronic trading on the New York Mercantile Exchange this morning (July 22nd) wiped out the gains made in heating oil prices yesterday.

At 05:37 Eastern Time, the August delivery heating oil contract was selling at $1.6895 (£1.03) per gallon, down 0.89 cents. Yesterday, the commodity had settled up 0.9 cents in a day of relatively subdued trading.

Crude oil also made gains in New York yesterday, but the September contract has fallen this morning on the back of unexpectedly weak demand data from the American Petroleum Institute.

An MF Global investor's report seen by Reuters warned that crude may fall further as the data suggest that upcoming demand statistics from the Energy Information Administration will also be weak.

"Energy demand remains weak. We would also conclude that the recent price rises we are seeing in energy are more attributable to exogenous variables as opposed to any noticeable improvement in the complex's basic fundamentals," the group concluded.