Asia-Pacific

Crude oil prices steady under $73 in Asia

(AP)
Updated: 2006-04-26 11:30

Crude oil prices were steady in Asian trading Wednesday as market participants awaited the release of a weekly U.S. petroleum supply snapshot, and after the U.S. President George W. Bush announced moves aimed at easing a fuel supply crunch.

Light, sweet crude for June delivery dropped 2 cents to US$72.86 a barrel in electronic trading on the New York Mercantile Exchange. The contract on Tuesday settled 45 cents lower at US$72.88.

Gasoline futures inched up fractionally to US$2.1300 a gallon (3.8 liters) while heating oil fell marginally to US$2.0580 a gallon. Natural gas declined 0.9 cent to US$7.245 per 1,000 cubic feet.

Bush on Tuesday gave the Environmental Protection Agency the authority to relax regional clean-fuel standards to attract more imports of gasoline to the United States and to make it easier for supplies to be moved from one state to another.

Bush also said he would defer shipments of crude oil into the U.S. Strategic Petroleum Reserve until the fall.

The moves came as retail regular gasoline prices in the U.S. were reported by the American Automobile Association to be near US$2.92 a gallon, about 32 percent above year-ago levels, a month before the Memorial Day holiday, which traditionally kicks off the summer driving season, when demand peaks.

Concerns about gasoline supplies in the U.S. ahead of the summer have been one of the various factors keeping a high floor under crude oil prices, which are 33 percent higher than a year ago.

In government figures due out later Wednesday, U.S. gasoline stocks are expected to show another big decline _ of 2.4 million barrels _ for the eighth consecutive week, according to a Dow Jones Newswires survey of energy analysts.

Gasoline stocks tend to build this time of year, but because of relatively low refinery utilization and an ongoing effort by refiners to dump gasoline stocks blended with the additive MTBE, they have posted big declines in recent weeks.

In the seven weeks ended April 14, gasoline stocks declined by more than 23 million barrels, according to last week's U.S. Energy Information Administration report. A projected draw of 2.4 million barrels would push stocks more than 6 million barrels below their five-year average for this time of year, according to EIA analyst Doug MacIntyre.

Distillate stocks, which include heating oil and diesel fuel, are expected to fall by 1.2 million barrels, while crude stocks were expected to show a draw of 137,500 barrels.

Oil traders are nervous about geopolitical tensions ranging from violence in Nigeria to the West's nuclear standoff with Iran to the move toward greater nationalization of natural resources in energy-rich Venezuela.

In a further escalation of the war of words between Iran and the West, Iran threatened Tuesday to begin hiding its nuclear program if the West takes any "harsh measures" against it _ Tehran's sharpest rebuttal yet to a U.N. Security Council Friday deadline to suspend uranium enrichment or face possible sanctions.