Crude Oil Prices Rise With Increased Gasoline Demand For The Independence Day holiday in the U.S
Crude oil futures rose Friday on strong U.S. gasoline demand ahead of the Independence Day holiday in the U.S. Brokers said energy futures were also being supported by hints from the Federal Reserve on Thursday that it could be done raising interest rates.
Societe Generale’s director of commodity strategy, Michael Guido, said that by highlighting the role energy prices were playing in helping to slow economic growth to more sustainable levels “it was like giving high energy prices an honorable mention.”
The question is now, Guido said, “how much higher do (energy prices) go before it becomes a detriment?”
Light sweet crude for August delivery rose 28 cents to $73.80 a barrel on the New York Mercantile Exchange, where gasoline futures fell by more than 2 cents to $2.2725 a gallon after settling at a nine-month high on Thursday.
“Earlier in the week, the $73 mark has always been considered the resistance level,” said Victor Shum, energy analyst at Purvin & Gertz in Singapore. “Now, we’ve gone beyond that.”
Brent crude futures on the ICE Futures exchange climbed 16 cents to $73.04 a barrel.
Worries about a supply crunch ahead of the July Fourth holiday grew after the U.S. government released a report Wednesday showing gasoline stocks shrank last week for the first time in more than two months.
Gasoline demand in the U.S. continues to rise in spite of soaring pump prices. Over the past four weeks, daily gasoline demand was up 0.9 percent from a year ago at 9.4 million barrels a day, according to Energy Department data released Wednesday. The average retail price of regular gasoline nationwide is $2.87 per gallon.
About 40.7 million Americans will travel 50 miles or more from home during the July Fourth holiday, up 1.2 percent from 40.2 million last year, according to projections by the AAA, the largest motor club in the United States.
All I can say is…. the US federal government investigated the oil companies and didn’t find any price gouging, price fixing or any other bad business practices….. ya right!