Gasoline and crude oil prices climb slightly

Gasoline prices are still climbing but some relief may be in sight by Tax Day.

The national average rose about half a cent to $3.93 per gallon on Friday. That’s only about a nickel less than last year’s high of $3.98 a gallon, reached in May.

Analysts think pump prices will top $4 a gallon nationally within the next couple of weeks and then start falling because of ample supplies and weakening demand.

In addition oil prices have leveled off on signs that the U.S. and other countries could soon release some emergency reserves to keep prices from rising.

Benchmark U.S. oil rose 65 cents to $103.43 per barrel in New York Friday, while Brent crude rose 77 cents to $123.16 per barrel in London.

Gasoline and crude oil prices climb slightly

-Gasoline prices are still climbing but some relief may be in sight after Tax Day.

The national average rose about half a cent to $3.93 per gallon on Friday, only about a nickel less than last year’s high of $3.98 a gallon, reached in May. Analysts think pump prices will top $4 a gallon nationally within the next couple of weeks, perhaps sooner. Then they could start to fall.

Tom Kloza, chief oil analyst at Oil Price Information Service, expects the national average for gas to hit about $4.05 per gallon by mid-April. It could level off there, and some analysts think it will start to fall. But Kloza also has said that the average could go as high as $4.25 per gallon later in the month, which would top the record of $4.11 set in 2008.

Several factors have affected the price drivers pay to fill their tanks. Gasoline prices typically climb in the spring as refineries switch to costlier summer blends that have additives to curb pollution. This year pump prices also have been pushed higher by rising crude oil prices, which refineries buy to make gasoline. The average price of gas is up 15 percent since Jan. 1.

Oil has jumped because of concerns that global supplies could become tighter due to tensions over Iran’s nuclear program. The U.S. and other countries are concerned that Iran, the world’s third-largest oil exporter, is building a nuclear weapon. Iran has denied it, but won’t let international inspectors take a closer look at its nuclear facilities.

On Friday President Barack Obama said that the U.S. will move ahead with tough sanctions aimed at squeezing Iran’s oil exports, after he determined that there is enough crude on world markets to take that step without harming U.S. allies.

U.S. sanctions on foreign banks that continue to purchase oil from Iran will take effect in June. The aim is to cut off Iran’s central bank, which processes almost all of the country’s oil business. Other countries are attempting to reduce Iran’s oil revenue through a variety of sanctions and an embargo.

The U.S., France and other nations are also considering a release of some emergency oil supplies to cool rising oil prices. Most analysts agree that releasing oil from the U.S. Strategic Petroleum Reserve, and other international inventories, would at best put a temporary cap on oil prices.

On Friday benchmark West Texas Intermediate crude rose 24 cents to finish at $103.02 per barrel in New York. That’s about 4 percent lower than the beginning of this month, when it was close to $109 a barrel.

The U.S. benchmark has risen about 38 percent from about $75 per barrel in October and is up 4 percent since the start of the year.

In other energy trading, heating oil was virtually unchanged at $3.17 per gallon, gasoline futures fell 3 cents to finish at $3.31 per gallon and natural gas fell 2 cents to end at $2.13 per 1,000 cubic feet, as it lingered at a 10-year low.

Brent crude rose 49 cents to finish at $122.88 per barrel in London.

Oil prices dip toward six-week low

Oil prices dipped toward six-week lows Friday amid signs Western powers plan to release strategic crude reserves soon.

By early afternoon in Europe, benchmark oil for May delivery was up 56 cents to $103.34 a barrel in electronic trading on the New York Mercantile Exchange. The contract dived $2.63 to settle at $102.78 per barrel in New York on Thursday.

In London, Brent crude for May delivery was up 83 cents at $123.22 per barrel on the ICE Futures exchange.

French Prime Minister Francois Fillon said Thursday that there’s a “good chance” that the U.S. and Europe will agree to release some of their oil reserves. Investors are mulling how much the additional supply would lower oil prices, which have jumped from $75 in October.

“A strategic stock release of some sort seems highly likely over the next few months,” Barclays Capital said in a report. “A large part of a potential stock release is already being priced in and has been one of the key deterrents from prices moving higher.”

Analyst Olivier Jakob of Petromatrix in Switzerland said that the countries seen pushing most for the release of reserves — the U.S., Britain and France — are the same ones leading sanctions against Iran and it would be in their interest “to have oil prices trending lower” before the expected start of talks with Iran about its disputed nuclear program on April 13.

“We can consider as a given that a release of strategic stocks is on its way,” Jakob said. “There is no serious prompt supply disruption but the reason for the stock release is price management not supply management.”

“We think that there is a risk for the announcement of the stock release to be made before April 12,” Jakob concluded.

Adding fuel to the speculation about a release of reserves, the Paris-based International Energy Agency said oil prices were “very high” and that it was “concerned by the impact of these high prices while the global economic recovery remains fragile.”

“The IEA was created to respond to serious physical supply disruptions, and we remain ready to act if market conditions so warrant,” IEA Executive Director Maria van der Hoeven said Thursday.

Some analysts expect crude has peaked for the year as slower global economic growth undermines demand for oil.

Capital Economics expects Brent crude to fall to $95 by the end of the year and $85 in 2013.

“The global economic recovery is set to disappoint,” Capital Economics said in a report. “Europe is facing a deep recession, which would only be made worse if oil prices stay elevated for much longer.”

In other energy trading, heating oil was up 1.98 cents at $3.1896 per gallon and gasoline futures rose 1.83 cents at $3.3580 per gallon. Natural gas added 0.7 cents at $2.156 per 1,000 cubic feet.

Alex Kennedy in Singapore contributed to this report.

Oil prices fall Thursday, talk of SPR release encourages profit-taking

NEW YORK — Oil prices fell for a third straight session on Thursday, snapping key technical support after growing talk of a release of strategic petroleum reserves (SPR) by consumer nations spurred profit-taking.

Even with the day’s losses for both contracts, Brent crude futures remained on pace to post a 14 per cent gain for the quarter, with U.S. crude on track for a 4 per cent rise.

Traders took profits from oil’s bull run as the United States, Britain and France consider releasing emergency stockpiles in hopes of bringing down high fuel prices that have caused economic and political fallout.

Economic concerns mounted after data showed a higher-than-expected number of Americans filed U.S. jobless claims, weighing on stock and crude markets.

“I think part of it is today’s economic data,� said Richard Ilczyszyn, chief market strategist and founder of iitrader.com LLC in Chicago. “I think traders are very sensitive to booking profits to have that 1 to 2 per cent gain for the month.�

“We’ve been talking about the SPR here, France and the UK, that could be weighing on some investors.�

Losses accelerated after U.S. crude broke through its 50-day moving average in afternoon trade, dragging down prices for international benchmark Brent as well.

Brent crude futures fell $1.77 to settle at $122.39 a barrel, extending losses after dropping 1.09 per cent the previous session.

U.S. crude futures lost $2.63 to settle at $102.78 a barrel, having dropped 1.8 per cent on Wednesday and marking the biggest two-day slide since mid-December. Brent’s premium to U.S. crude increased to $19.61 a barrel, based on settlements.

Front-month April gasoline showed some resilience ahead of Friday’s contract expiry, managing a 0.51 cent rise to settle at $3.4006 a gallon.

In contrast, April heating oil fell 1.53 per cent, nearly 5 cents.

Brent and U.S. crude trading volumes were both just above half a million lots, leaving Brent nudging 0.2 per cent over its 30-day average. U.S. dealings were 14 per cent below its 30-day average in post-settlement trading.

Despite the run-up in prices this year, oil volatility has dropped to the lowest level in five years this month, suggesting that demand for protection against risks including an abrupt loss of Iranian supplies, a dramatic drop in demand or a release of emergency reserves has waned.

RESERVE RELEASE?

In addition to the United States, Britain and France, other countries including South Korea and Japan may join the reserves plan, which comes after prices jumped 15 per cent since December.

French Prime Minister Francois Fillon said he believes there is a good chance of a U.S.-Europe accord on a release of strategic oil reserves.

The impact on Iranian supplies from U.S. and EU sanctions aimed at halting Tehran’s nuclear program, an accident in the North Sea and reported attacks on oil-producing areas in South Sudan this week have contributed to the price rise.

The increase in oil prices drew a rare opinion piece in the Financial Times o n Wednesday from Saudi Arabia’s oil minister Ali al-Naimi, in which he reiterated comments from last week that the market was well supplied and reassured that the OPEC kingpin would meet any supply loss.

Consumer nations may seek reassurance from Saudi Arabia that it will not cut oil production and neutralize the impact on oil prices if they tap emergency reserves, industry and diplomatic sources said.

Last year after the International Energy Agency tapped reserves at the end of June to fill the gap left by Libya’s civil war, Saudi output at first remained high, and then fell.

Some members of the IEA have argued against the need for another coordinated effort by the agency, although it said in a statement it was ready to respond if market conditions warrant action.

“The oil market has been tightening in recent months,� the IEA said in a statement from its Executive Director Maria van der Hoeven. “The International Energy Agency, like many others, is concerned by the impact of these high prices while the global economic recovery remains fragile.�

Oil prices fall Thursday, talk of SPR release encourages profit-taking

NEW YORK — Oil prices fell for a third straight session on Thursday, snapping key technical support after growing talk of a release of strategic petroleum reserves (SPR) by consumer nations spurred profit-taking.

Even with the day’s losses for both contracts, Brent crude futures remained on pace to post a 14 per cent gain for the quarter, with U.S. crude on track for a 4 per cent rise.

Traders took profits from oil’s bull run as the United States, Britain and France consider releasing emergency stockpiles in hopes of bringing down high fuel prices that have caused economic and political fallout.

Economic concerns mounted after data showed a higher-than-expected number of Americans filed U.S. jobless claims, weighing on stock and crude markets.

“I think part of it is today’s economic data,� said Richard Ilczyszyn, chief market strategist and founder of iitrader.com LLC in Chicago. “I think traders are very sensitive to booking profits to have that 1 to 2 per cent gain for the month.�

“We’ve been talking about the SPR here, France and the UK, that could be weighing on some investors.�

Losses accelerated after U.S. crude broke through its 50-day moving average in afternoon trade, dragging down prices for international benchmark Brent as well.

Brent crude futures fell $1.77 to settle at $122.39 a barrel, extending losses after dropping 1.09 per cent the previous session.

U.S. crude futures lost $2.63 to settle at $102.78 a barrel, having dropped 1.8 per cent on Wednesday and marking the biggest two-day slide since mid-December. Brent’s premium to U.S. crude increased to $19.61 a barrel, based on settlements.

Front-month April gasoline showed some resilience ahead of Friday’s contract expiry, managing a 0.51 cent rise to settle at $3.4006 a gallon.

In contrast, April heating oil fell 1.53 per cent, nearly 5 cents.

Brent and U.S. crude trading volumes were both just above half a million lots, leaving Brent nudging 0.2 per cent over its 30-day average. U.S. dealings were 14 per cent below its 30-day average in post-settlement trading.

Despite the run-up in prices this year, oil volatility has dropped to the lowest level in five years this month, suggesting that demand for protection against risks including an abrupt loss of Iranian supplies, a dramatic drop in demand or a release of emergency reserves has waned.

RESERVE RELEASE?

In addition to the United States, Britain and France, other countries including South Korea and Japan may join the reserves plan, which comes after prices jumped 15 per cent since December.

French Prime Minister Francois Fillon said he believes there is a good chance of a U.S.-Europe accord on a release of strategic oil reserves.

The impact on Iranian supplies from U.S. and EU sanctions aimed at halting Tehran’s nuclear program, an accident in the North Sea and reported attacks on oil-producing areas in South Sudan this week have contributed to the price rise.

The increase in oil prices drew a rare opinion piece in the Financial Times o n Wednesday from Saudi Arabia’s oil minister Ali al-Naimi, in which he reiterated comments from last week that the market was well supplied and reassured that the OPEC kingpin would meet any supply loss.

Consumer nations may seek reassurance from Saudi Arabia that it will not cut oil production and neutralize the impact on oil prices if they tap emergency reserves, industry and diplomatic sources said.

Last year after the International Energy Agency tapped reserves at the end of June to fill the gap left by Libya’s civil war, Saudi output at first remained high, and then fell.

Some members of the IEA have argued against the need for another coordinated effort by the agency, although it said in a statement it was ready to respond if market conditions warrant action.

“The oil market has been tightening in recent months,� the IEA said in a statement from its Executive Director Maria van der Hoeven. “The International Energy Agency, like many others, is concerned by the impact of these high prices while the global economic recovery remains fragile.�

Asia Fuel Oil-Prices ease to three-week low

Fri Mar 30, 2012 8:17am EDT

Oil Rises Above $103 After Hitting 6-Week Low

Oil prices dipped toward six-week lows Friday amid signs Western powers plan to release strategic crude reserves soon.

By early afternoon in Europe, benchmark oil for May delivery was up 56 cents to $103.34 a barrel in electronic trading on the New York Mercantile Exchange. The contract dived $2.63 to settle at $102.78 per barrel in New York on Thursday.

In London, Brent crude for May delivery was up 83 cents at $123.22 per barrel on the ICE Futures exchange.

French Prime Minister Francois Fillon said Thursday that there’s a “good chance” that the U.S. and Europe will agree to release some of their oil reserves. Investors are mulling how much the additional supply would lower oil prices, which have jumped from $75 in October.

“A strategic stock release of some sort seems highly likely over the next few months,” Barclays Capital said in a report. “A large part of a potential stock release is already being priced in and has been one of the key deterrents from prices moving higher.”

Analyst Olivier Jakob of Petromatrix in Switzerland said that the countries seen pushing most for the release of reserves — the U.S., Britain and France — are the same ones leading sanctions against Iran and it would be in their interest “to have oil prices trending lower” before the expected start of talks with Iran about its disputed nuclear program on April 13.

“We can consider as a given that a release of strategic stocks is on its way,” Jakob said. “There is no serious prompt supply disruption but the reason for the stock release is price management not supply management.”

“We think that there is a risk for the announcement of the stock release to be made before April 12,” Jakob concluded.

Adding fuel to the speculation about a release of reserves, the Paris-based International Energy Agency said oil prices were “very high” and that it was “concerned by the impact of these high prices while the global economic recovery remains fragile.”

“The IEA was created to respond to serious physical supply disruptions, and we remain ready to act if market conditions so warrant,” IEA Executive Director Maria van der Hoeven said Thursday.

Some analysts expect crude has peaked for the year as slower global economic growth undermines demand for oil.

Capital Economics expects Brent crude to fall to $95 by the end of the year and $85 in 2013.

“The global economic recovery is set to disappoint,” Capital Economics said in a report. “Europe is facing a deep recession, which would only be made worse if oil prices stay elevated for much longer.”

In other energy trading, heating oil was up 1.98 cents at $3.1896 per gallon and gasoline futures rose 1.83 cents at $3.3580 per gallon. Natural gas added 0.7 cents at $2.156 per 1,000 cubic feet.

———

Alex Kennedy in Singapore contributed to this report.

Euro zone inflation slows less than expected

BRUSSELS |
Fri Mar 30, 2012 7:10am EDT

BRUSSELS (Reuters) – Inflation in the euro zone slowed slightly in March but not by as much as expected, with rising oil prices hitting consumers’ and complicating the European Central Bank’s task of reviving growth without firing up the cost of living.

Consumer prices in the 17 nations sharing the euro were up 2.6 percent in March from a year ago, compared with 2.7 percent in February, the European Union’s statistics office Eurostat said on Friday. The March figure was above the 2.5 percent level forecast by economists in a Reuters poll.

While inflation is below last year’s peak of 3 percent, economists and the ECB had expected prices to fall steadily as the economy has stumbled, offering some relief to households at a time of rising unemployment and sharp spending cuts.

“The risk that consumer price inflation will be stickier due to high oil prices is a worry for the ECB, while there is also concern within the bank about the longer-term inflationary impact of the massive liquidity that the ECB has provided to banks,” economist Howard Archer of IHS Global Insight said.

“(Although) the euro zone is clearly struggling to come out of recession, there has recently been an easing in the most serious downside risks facing the euro zone economies. Unless these risks build up substantially again, it is hard seeing the ECB cutting interest rates further,” Archer added.

The ECB, which will decide next Wednesday on interest rates, held steady at 1 percent earlier this month, judging that low rates were crucial to stimulating growth and that underlying pressures on prices seem limited for the time being.

Still, ECB President Mario Draghi said early in March that rising energy prices would likely push inflation above 2 percent in 2012 “with upside risks prevailing”.

That is above the ECB’s target of below, but close to 2 percent, which the Frankfurt-based bank judges to be right for price stability and a healthy economy.

“We think that euro area inflation is likely to stay above the ECB’s price stability norm of close but below 2 percent this year,” said Daniele Antonucci, an economist at Morgan Stanley.

But ING’s Martin van Vliet saw little prospect of any ECB move for the time being.

“With inflation proving stickier than previously expected and the ECB still excited by signs of stabilization in economic activity, interest rates will likely remain on hold next week, and in the coming months,” van Vliet said in a note to clients.

High crude oil prices – up around 16 percent this year -have fuelled the upward pressure on inflation.

Brent crude rose towards $123 on Friday as investors bet on a tighter gasoline market in the world’s largest oil consumer, the United States, during the peak summer driving season and on persistent worries of a supply disruption in the Middle East.

Tough sanctions by the West targeting Iran’s nuclear program have curbed oil exports from the Islamic Republic and supply could tighten further from July 1 when a ban on European insurance cover for Iranian oil takes effect.

For details of Eurostat release click on:

here

(Reporting by Robin Emmott; editing by Rex Merrifield/Jeremy Gaunt)