Oil Prices Fluctuate on Stock Market Gains, Dollar’s Strength

As of 9:06 am EST, the price of crude had increased by 0.1 percent to reach $77.09 a barrel and the price of heating oil had risen by 0.1 percent.

HEAT USA Price Report

Today’s average retail heating oil price per gallon: Up $0.08
Morning projection (for Thursday’s average price per gallon): Down $0.02

Gains in global stock markets have encouraged investors to put money in riskier assets, such as commodities and equities, rather than currency. That confidence has kept oil prices up despite a lot of volatility caused by the dollar’s fluctuations. Greece’s finance minister announced that Greece would be able to achieve its deficit reductions without the EU’s help, boosting the euro and driving down the dollar. The weak dollar lifted oil prices, since it makes dollar-priced commodities cheaper for investors who hold other currencies. The dollar has since recovered, cutting into gains made by the oil markets. Oil traders have turned some of their attention from currency markets to the fundamentals of supply and demand, since the API’s inventory report comes out this afternoon, followed by the EIA’s on Thursday morning.

HEAT USA price experts report that traders predict drawdowns in distillate stockpiles, which include heating oil and diesel, because of last week’s snowstorm on the East Coast. However, crude oil inventories are predicted to rise, so any decline in supplies of refined oil products could simply be a result of low refinery activity.