Heating oil pares gains on Nymex

31/07/2009

Heating oil prices fell during early trading on the New York Mercantile Exchange (Nymex) this morning (July 31st), paring gains made on the bourse yesterday.

At 05:57 Eastern Time, the August delivery heating oil contract was trading at $1.758 (£1.06) a gallon, down more than a cent on yesterday's settle price.

Despite a weak demand report from the Energy Information Administration, heating oil rose sharply yesterday, closing up more than nine cents on the gallon. Similar gains were also witnessed in Nymex crude futures on the back of stronger equity markets.

However, Reuters reports that traders are once more returning to demand fundamentals and are cautious ahead of US gross domestic product data due to be published later today.

"Yesterday's US employment data cannot really justify the gain [in oil prices] when Wednesday's data showed a large increase in crude oil inventories," said Andy Sommer, oil analyst with EGL in Switzerland, speaking to the news agency.