NEW YORK - Oil prices ended a 7 per cent rout on Thursday as production problems at two major refineries in the United States rekindled worries over petrol supplies at the height of summer vacation season.
US crude for August delivery, which expires Thursday, rose 42 cents to US$73.08 a
barrel while London Brent for September delivery slipped 18 cents to US$73.72.
Both benchmarks for global oil prices had been in a dive since last week that deepened Wednesday after the US government reported surprise builds in stockpiles of crude and petrol.
US oil's push higher on Thursday came after leading North American refiner Valero Energy Corp. announced it shut a petrol-making unit at its St. Charles, Louisiana, refinery for 20 days for unplanned repairs.
ConocoPhillips, meanwhile, said it shut its big Wood River refinery in Roxana, Illinois, because of a power outage caused by severe storms.
"There's talk on these refinery headlines, and still some concern over the strong petrol demand," said Tim Evans, analyst at Citigroup Global Markets. "But the gains should be limited as supplies of petrol are doing very well."
The energy markets tend to focus on petrol during the summer months when US drivers take to the roads for vacations, bumping up demand for the fuel to seasonal peaks.
US oil has dropped from the record US$78.40 hit last week. Government data Wednesday showed US inventories of petrol rose by 1.5 million barrels and crude stocks climbed 0.2 million barrels due to strong imports, counter to expectations of a decline.
But the data also showed that four-week average US petrol demand, which accounts for more than a tenth of the world's total consumption of oil, had risen 1.9 per cent from a year ago.
"The market is in an extremely nervous state right now. The slightest thing will be able to lift prices," said London-based oil analyst Geoff Pyne.
Crude continued to find support from the conflict between Israel and Lebanese Hizbollah guerrillas, which has killed more than 300 people.
There was no sign that Israel or its Lebanese Shi'ite foes were ready to stop the fighting, but also no indication that the violence would engulf oil-producing neighbours or affect exports from Syria or Iran, both supporters of Hizbollah.
The market shrugged off comments from Iran, which repeated its determination to produce atomic fuel in defiance of international calls to halt the work.
The world's fourth largest oil exporter said it wanted to resolve the dispute diplomatically and was still reviewing a package of nuclear proposals backed by six nations.
- REUTERS
NEW YORK - Oil prices ended a 7 per cent rout on Thursday as production problems at two major refineries in the United States rekindled worries over petrol supplies at the height of summer vacation season.
US crude for August delivery, which expires Thursday, rose 42 cents to US$73.08 a
AdvertisementAdvertise with NZME.