West Texas Intermediate crude advanced to a point last recorded five weeks ago as US consumer sentiments improved in April and demand for gasoline expanded. Brent’s premium to WTI declined to the lowest since September.
WTI was on course for its biggest weekly surge so far in 2014. Consumer sentiment, as measured by the Thomson Reuters/University of Michigan preliminary index, added to hit 82.6 points, the highest mark since July. The Brent-WTI margin narrowed as Libya was expected to increase oil exports.
“As the economy grows, oil demand will grow. One of the most supportive things you can say about crude is the strong gasoline demand,” Energy Analytic’s director Tom Finlon told Bloomberg.
On the New York Mercantile Exchange, May delivery WTI futures jumped 67 cents or 0.6% to trade at $104.07 per barrel as of 2:01 pm, after hitting $104.44 earlier. All contracts traded at a volume that was 33% higher than the 100-day average. Prices have gained 2.9% this week.
The per barrel price of May settlement Brent hit $107.72 after adding 26 cents on the ICE Futures Europe Exchange in London. The European benchmark crude premium to Brent ratio was $3.65. The spread stood at $4.06 at closing, the narrowest gap since the September 9.
An average of 8.81 million barrels of US gasoline per day was utilized in the four weeks prior to April 4, the highest demand since January 3, the EIA has said. Fuel stockpiles declined to 210.4 million barrels, the smallest since November 15.
Analysts believe that the latest consumer confidence figures indicate a solid demand in gasoline, which is leading in the overall oil consumption.
Gasoline for May settlement hit $3.0321 per gallon after adding 2.42 cents or 0.8% on the Nymex.
But as NASDAQ reports, Brent crude has been subject of pressure, with its rise in price been seen to expose it to corrective action.
To contact the reporter of this story; Jonathan Millet at email@example.com
For 2 weeks free access to the ForexMinute Premium Plan, visit www.forexminute.com/newsletter