Gasoline Prices Push Crude Higher

U.S. crude futures may draw some support this week from signs of improving gasoline demand and a pick-up in U.S. refinery activity, CNBC’s latest survey of market professionals showed — although a record supply overhang may restrain any move higher.

Gasoline prices have now increased for 12 weeks in a row, gaining nearly 43 cents, or about 13 percent, since the beginning of February, according to the Lundberg survey released on May 4. Refineries operated at 92.9 percent of capacity for the week ended April 25 and latest data this week may show a 0.5 percentage point increase during the week ended May 2, according to energy information provider Platts.

“Last week, we saw gasoline production hit a record 10 million barrels a day in the U.S. and as we struck another month of near-record auto sales, demand will not be denied despite fuel efficiency,” said Carl Larry, president of Houston-based consultancy Oil Outlooks and Opinions.

“Refineries should edge up a notch and we will probably see an easing of crude oil imports to the U.S.,” said Larry, who holds a bullish view on WTI futures for this week. “That’s going to help erase some of the record crude inventories and give life to WTI back above $100.”

via CNBC

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Alfonso Esparza

Alfonso Esparza

Senior Currency Analyst at Market Pulse
Alfonso Esparza specializes in macro forex strategies for North American and major currency pairs. Upon joining OANDA in 2007, Alfonso Esparza established the MarketPulseFX blog and he has since written extensively about central banks and global economic and political trends. Alfonso has also worked as a professional currency trader focused on North America and emerging markets. He has been published by The MarketWatch, Reuters, the Wall Street Journal and The Globe and Mail, and he also appears regularly as a guest commentator on networks including Bloomberg and BNN. He holds a finance degree from the Monterrey Institute of Technology and Higher Education (ITESM) and an MBA with a specialization on financial engineering and marketing from the University of Toronto.
Alfonso Esparza