Oil up on China, US trade data; pump prices rise
NEW YORK (AP) — Oil prices nudged above $96 a barrel on Friday after new reports showed better-than-expected trade data in China and the U.S. trade deficit shrank in December to the lowest point in three years.
Both pointed to a stronger global economy and more demand for oil.
At midday benchmark crude for March delivery was up 48 cents to $96.31 per barrel on the New York Mercantile Exchange.
In the U.S., drivers still can't catch a break at the pump. The average price for a gallon of gas rose a penny to $3.57. That's up 27 cents from a month ago and 8 cents more than last year at this time.
Drivers in Massachusetts who are filling up ahead of a massive blizzard that could dump up to 3 feet of snow are paying an average of $3.69. Connecticut drivers are paying around $3.90, while the average pump price in New York is $3.92 a gallon. Local television coverage showed lines of cars at gas stations reminiscent of those seen after Superstorm Sandy.
Once they fill up and stock up on groceries, many people in the Northeast might not drive again for a day or more. Demand for gasoline should drop, supplies should rise and prices in the region should drop a bit, says Tom Kloza, chief oil analyst for Oil Price Information Service.
"The simple impact (these storms) have is that they destroy demand for a period of time," Kloza says.
The brunt of the storm is not expected to hit refineries around New York and Philadelphia the way that Superstorm Sandy did, so no supply disruptions are expected. If New England ports get snowed in for a few days, it could delay shipments of gasoline by barge, which could lead to reduced supplies, Kloza says.
The storm could bring a break in gasoline prices after a steady march upward in recent weeks. Kloza thinks that later in February and in March prices will rise as they do most years, but perhaps not as fast, because prices have already climbed so high.
"We were in an uptrend but clearly it was too brisk," he said. "The market borrowed some of the increases that usually come in February and March."
Meanwhile oil traders reacted to a report showing that China's trade growth surged in January. Exports soared 25 percent from a year earlier and import growth rocketed to 28 percent.
Analysts said the year-on-year data could be distorted because the Lunar New Year holidays fell in January in 2012. This year, companies picked up pace in January to fill orders before shutting down for the holiday, which this year falls in February.
And the Commerce Department said Friday that the U.S. trade deficit fell nearly 21 percent in December from November, as oil imports plummeted. That's the smallest trade deficit in nearly three years. The smaller trade gap means the economy probably performed better in the fourth quarter than first estimated last week.
In London, Brent crude, used to price international varieties of oil, rose $1.71 to $118.95 a barrel on the ICE Futures exchange.
In other energy futures trading on the Nymex:
— Wholesale gasoline rose 6 cents to $3.06 a gallon.
— Natural gas rose 1 cent to $3.29 per 1,000 cubic feet.
— Heating oil gained 5 cents to $3.25 a gallon.