Crude stable after mixed EIA report

23/07/2009

Crude prices stayed relatively flat during trading this morning (July 23rd) as investors made sense of mixed demand data published by the Energy Information Administration (EIA) yesterday.

In its weekly US petroleum inventories report, the Energy Department division revealed that crude inventories dropped 1.8 million barrels last week, indicating support in demand.

However, this was largely offset by a climb in gasoline, heating oil and propane stocks seen during the same period.

During the summer months, gasoline inventories are typically expected to fall as the driving season peaks in the US.

Commenting on the figures, Eugen Weinberg, an analyst at Commerzbank AG in Frankfurt, told Bloomberg: "Demand is weak, and spare capacity is the largest it's ever been. The market is pricing in a demand recovery round the corner, but I don't see it."

It is the second day of relatively flat trading for crude futures on the New York Mercantile Exchange, with barrel prices hovering around the $65 (£39) mark.