Supply worries send oil prices higher

The US Energy Information Administration reported Thursday that US natural gas inventories grew by 35 billion cubic feet in the week ending May 11. The gains brought the amount of natural gas in storage to 1.84 trillion cubic feet in the lower 48 states, almost 21 percent above the five-year average. It remains below last year’s level of 2.07 trillion cubic feet in storage, however. Despite the reported gain, by early afternoon prices for natural gas on the New York Mercantile Exchange were 13 cents higher to $8.18 per million British thermal units.

Meanwhile, June contracts for West Texas Intermediate crude on Nymex were $1.75 higher to $64.30 per barrel. Prices were sent higher by ongoing supply concerns due to continuing trouble in Nigeria. In addition, Conoco-Phillips (NYSE: COP) reported that two of its refineries, one in Texas and one in Oklahoma, are seeing reduced output due to maintenance closures. June gasoline futures had added 8 cents, to $2.42 per gallon, while July heating oil gained 5 cents to $1.92 per gallon.

June gold was down again on Thursday on the New York Mercantile Exchange, dropping $4.30 to $657.20 per troy ounce and bringing its two-day decline to almost $16. Analysts said that the declines were due to technical issues rather than in reaction to any substantial news.

In other precious metals, July silver was 4.7 cents lower to $12.883 per troy ounce at the close, while July platinum was down $7.90 to $1,317.90 per troy ounce. June palladium was higher, however, adding $2.90 to trade at $360.40 per troy ounce.

In base metals, copper was lower again. It has now dropped 8 percent in four sessions, and analysts are calling the decline a correction rather than simply a sell-off. June copper dropped 11.6 cents on today’s session to end at $3.3065 per pound.

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