WTI Crude Advances as Cushing Inventories Drop for Eighth Week

Mar 26, 2014 10:39 am ET

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March 26 (Bloomberg) -- West Texas Intermediate gained, narrowing its discount to Brent, after reports showed inventories at Cushing, Oklahoma, decreased for an eighth week and automobile demand rose the most in a year.

Prices climbed as much as 0.9 percent. Stocks at the WTI delivery point slid 1.33 million barrels to 28.5 million in the week ended March 21, the Energy Department said. Total crude supplies climbed 6.62 million. WTI also rose as a Commerce Department report showed vehicle demand lifted February durable- goods orders.

“Cushing is the main focus,” said Carl Larry, president of Oil Outlooks & Opinions LLC in Houston. “Durable goods and vehicle demand are pretty strong, giving us optimism for stronger economy and higher oil consumption.”

WTI for May delivery gained 63 cents, or 0.6 percent, to $99.82 a barrel at 10:36 a.m. on the New York Mercantile Exchange. The volume was 41 percent below the 100-day average for the time of day. The price was $100.08 before the EIA report.

Brent for May settlement fell 2 cents to $106.97 a barrel on the London-based ICE Futures Europe exchange. The European benchmark crude was at a premium of $7.15 to WTI, down from yesterday’s $7.80.

Cushing stockpiles decreased to a two-year low. Total stockpiles climbed to 382.5 million, the most since November.

Orders for motor vehicles and parts climbed 3.6 percent in February, the Commerce Department reported. Demand for all durable goods, items meant to last at least three years, climbed a more-than-forecast 2.2 percent.

The Houston Ship Channel, home to the nation’s largest petrochemical complex and export port, reopened in nearly all directions of vessel traffic for the first time since a March 22 oil spill, according to the U.S. Coast Guard.

“Houston Ship Channel coming back online may ease supply concern,” said Phil Flynn, senior market analyst at the Price Futures Group in Chicago.