Crude climbing after further losses

22 January 2010

Written by Bob Burton

Crude oil prices made tentative upward movements during the electronic trading session of the New York Mercantile Exchange this morning (January 22nd), recovering from a one-month low.

Although the commodity started brightly during the Asian trading session yesterday, weak demand data from the Energy Information Administration sent both crude and heating oil tumbling later in the day, with the former closing at $76.08 (£46.76) a barrel.

According to official figures, refiners in the US operated at a production rate lower than it has been in decades, with a 2.9 percentage point drop witnessed in refinery utilisation last week. Total utilisation stood at 78.4 per cent.

Speaking to Reuters, Serene Lim, a Singapore-based oil analyst at ANZ, said the figures had shocked the market.

"At this time of year they shouldn't be dropping that much. With low demand, refiners don't find an incentive to produce more," the analyst commented.

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