Oil prices inched down Thursday after the U.S. government said domestic stocks of crude rose, easing concerns of inadequate supply going into the peak demand Northern Hemisphere winter.

Oil prices inched down Thursday after the U.S. government said domestic stocks of crude rose, easing concerns of inadequate supply going into the peak demand Northern Hemisphere winter.

Light, sweet crude for January delivery fell 18 cents to $ 60.67 a barrel in electronic trading Thursday on the New York Mercantile Exchange. The contract slipped 52 cents to settle at $ 60.85 a barrel Wednesday.

Heating oil lost a cent to $ 1.8350 a gallon while gasoline fell marginally to $ 1.6405 a gallon.

In the U.S. Energy Department’s weekly petroleum supply snapshot Wednesday, crude inventories rose 900,000 barrels in the week ending Dec. 9 to 321.2 million barrels, 11.7 percent above year-ago levels and well above the upper end of the average range for December.

U.S. stocks of distillate fuels, which include heating oil and diesel, slipped 100,000 barrels to 130.5 million barrels. Distillate inventories remain 5.2 percent above year-ago levels.

‘Even though heating oil inventories fell, the level they are at is not as low as we had expected,’ said Tetsu Emori, chief commodities strategist at Mitsui Bussan Futures in Tokyo. ‘The market is just watching temperatures in the northeast of the U.S. for price direction.’

Cold weather usually causes a rise in demand for heating-related oil products. The Northeast consumes up to 80 percent of total heating fuel used in the country.

‘For oil markets, it’s all about the weather,’ said Energyintel analyst David Knapp in a research note.

Analysts said the market would also be closely monitoring the release of a U.S. natural gas inventory data later Thursday.

‘Demand for gas is outstripping expectations and the question is how storage will fare as it appears we will be drawing on it much earlier than normal,’ said Phil Flynn analyst at Alaron Trading Corp. in a research note. Natural gas is most commonly used to heat homes in the Midwestern states.

Nymex natural gas for January delivery declined 35.4 cents to $ 14.325 per 1,000 cubic feet. The contract reached an all-time intraday high of $ 15.78 per million British thermal units on Tuesday.

Source : www.forbes.com