Heating oil flat in early trade

28/07/2009

Heating oil prices held steady on the New York Mercantile Exchange this morning (July 28th) and were virtually unchanged from yesterday's settle price of $1.7966 (£1.08) a gallon.

Crude futures trading on the bourse rose marginally during the electronic trading period.

The subdued trading comes as the market awaits the publication of the latest demand data from the American Petroleum Institute (API), which will show whether stocks of gasoline rose or fell last week.

Gasoline demand, like heating oil, is subject to heavy seasonal fluctuation and inventories typically fall during the summer as the US driving season gets into full swing.

However, in recent months API data have shown the effect that the global economic crisis has had on demand for gasoline, with inventories rising considerably week-on-week and year-on-year.

Meanwhile, the Energy Information Administration has recorded many weeks of rising heating oil inventories since the onset of the economic difficulties, while demand for crude has also plummeted.