NYMEX oil trims losses as mogas surges, eyes on OPEC

Reuters, 06.10.03, 12:33 PM ET NEW YORK, June 10 (Reuters) - NYMEX crude futures trimmed their losses midday Tuesday while prompt gasoline futures surged on cash market strength after two overnight refinery fires in Louisiana, traders said. But sentiment remained bearish amid talk within OPEC that the cartel would keep current output quotas unchanged through September, ahead of the group's meeting on Wednesday in Qatar. At 12:33 EST, NYMEX July crude was 3 cents weaker at $31.42 a barrel, after extending session highs to $31.40. It earlier dipped to a session low of $30.90. "There's a bit of short-covering going on after prompt crude extended the session highs," said a NYMEX floor trader. In London, IPE July crude contract was up 2 cents at $27.87 a barrel, also recouping earlier losses. Prompt gasoline futures regained their footing after giving up overnight gains, lifted by higher Gulf Coast cash gasoline market prices. NYMEX July gasoline was up 1.15 cents at 90.80 cents a gallon, just below its session peak of 91.00 cents. Arriving in Doha, Qatar, on Tuesday to attend OPEC's meeting on Wednesday, Venezuelan Energy and Mines Minister Rafael Ramirez said saw the oil market as balanced with supply good. [nDBT000659] A similar comment earlier came from Ali Rodriguez, head of Venezuela's state oil company PDVSA. "Right now the market is balanced, stocks are low especially in the U.S., and demand will rise in the next quarter so I'm not expecting any dramatic decisions," said Rodriguez. A proposal from Kuwait that OPEC should hold its output steady to September was "not a bad idea," said Nigeria's Presidential Advisor on Petroleum and Energy Rilwanu Lukman, a former OPEC president [nDBT000656]. Earlier, Kuwaiti Oil Minister Sheikh Ahmad al-Fahd al-Sabah said OPEC should hold output unchanged until its next scheduled meeting in late September [nL10504694]. UAE Petroleum and Mineral Resources Minister Obaid bin Saif al-Nasseri, meanwhile, said that OPEC needed to make sure it complied with production limits introduced at the beginning of this month [nL10644174]. In the U.S., Exxon Mobil Corp.'s (nyse: XOM - news - people) Chalmette, Louisiana, oil refinery had a fire very early Tuesday, but the company said that operations at the plant had returned to "normal" by Tuesday morning [nN10205313]. That was one of two fires within two miles and one hour in St. Bernard Parish, southeast of New Orleans. The other fire was at the Murphy Oil Corp. (nyse: MUR - news - people). plant in Meraux, which a spokesman said was extinguished by 5:15 a.m. EST [nN10256805]. Analysts views were mixed on U.S. government oil inventory data due out Wednesday morning, but the average of a Reuters poll of oil market analysts was for a 500,000 barrel stock increase as imports were expected to have dipped while refinery runs slowed a bit [nN09153458]. Gasoline supplies were expected to have risen by 1.4 million barrels and distillate were expected to have been boosted by 1.6 million barrels. NYMEX July heating oil futures were off 0.20 cent at 77.70 cents a gallon, paring earlier losses. It traded between 76.80 and 77.90 cents.