Crude futures climbed above US$51 a barrel yesterday after the US government reported that the nation's crude inventories had fallen, surprising traders who had expected another rise.
On the New York Mercantile Exchange, light, sweet crude for July delivery were up US$0.12 at US$51.10 at midday in Singapore.
Heating oil prices fell marginally to US$1.4270 a gallon (3.8 liters), while unleaded gas rose to US$1.4523 a gallon.
The US Energy Information Administration's midweek petroleum data showed US commercial crude oil inventories fell 1.6 million barrels to 332.4 million barrels in the week ending May 20 from the previous week.
Traders were expecting another increase after growing accustomed to consecutive gains in recent months. Wednesday's report was just the second decline in 15 weeks.
Still, oil analyst Victor Shum of Texas-headquartered Purvin & Gertz in Singapore said the rally was a "short-term reaction" to the results of the US report, adding that traders should take note of the healthy increase in crude stocks in the past months.
Inventories are 32.4 million barrels higher than year-ago levels.
"In the short term, there's a possibility that by the beginning of next week, prices will fall after all the hoopla about Memorial Day is over," Shum said.
He said the drop in crude stocks is to be expected as the US gears up for the start of the summer driving season, starting with this weekend's Memorial Day holiday.
Meanwhile, US gasoline inventories rose 600,000 barrels to 215.4 million barrels, up from 203.6 million a year ago. Most analysts had predicted a decline in gasoline stocks.
Distillates rose 1.9 million barrels to 105.7 million, up from 104.7 million last year but still in the lower half of the average range for this time of year. High sulfur distillates, or heating oil, comprised most of that increase, rising 1.6 million barrels to 39.7 million barrels, up from 35.9 million a year ago.
Crude prices are about US$7 lower than their all-time high of US$58.28 set on April 4.
Comments from key members of OPEC about possibly reducing production have also lent some support to prices. On Wednesday, Iranian Oil Minister Bijan Zanganeh said the option of cutting output is "something that needs to be discussed."
Last week, Venezuela's oil minister said Venezuela, along with other members of the OPEC, would have to evaluate the proposal to decrease oil output at a meeting next month.
RETHINK? The defense ministry and Navy Command Headquarters could take over the indigenous submarine project and change its production timeline, a source said Admiral Huang Shu-kuang’s (黃曙光) resignation as head of the Indigenous Submarine Program and as a member of the National Security Council could affect the production of submarines, a source said yesterday. Huang in a statement last night said he had decided to resign due to national security concerns while expressing the hope that it would put a stop to political wrangling that only undermines the advancement of the nation’s defense capabilities. Taiwan People’s Party Legislator Vivian Huang (黃珊珊) yesterday said that the admiral, her older brother, felt it was time for him to step down and that he had completed what he
Taiwan has experienced its most significant improvement in the QS World University Rankings by Subject, data provided on Sunday by international higher education analyst Quacquarelli Symonds (QS) showed. Compared with last year’s edition of the rankings, which measure academic excellence and influence, Taiwanese universities made great improvements in the H Index metric, which evaluates research productivity and its impact, with a notable 30 percent increase overall, QS said. Taiwanese universities also made notable progress in the Citations per Paper metric, which measures the impact of research, achieving a 13 percent increase. Taiwanese universities gained 10 percent in Academic Reputation, but declined 18 percent
UNDER DISCUSSION: The combatant command would integrate fast attack boat and anti-ship missile groups to defend waters closest to the coastline, a source said The military could establish a new combatant command as early as 2026, which would be tasked with defending Taiwan’s territorial waters 24 nautical miles (44.4km) from the nation’s coastline, a source familiar with the matter said yesterday. The new command, which would fall under the Naval Command Headquarters, would be led by a vice admiral and integrate existing fast attack boat and anti-ship missile groups, along with the Naval Maritime Surveillance and Reconnaissance Command, said the source, who asked to remain anonymous. It could be launched by 2026, but details are being discussed and no final timetable has been announced, the source
SHOT IN THE ARM: The new system can be integrated with Avenger and Stinger missiles to bolster regional air defense capabilities, a defense ministry report said Domestically developed Land Sword II (陸射劍二) missiles were successfully launched and hit target drones during a live-fire exercise at the Jiupeng Military Base in Pingtung County yesterday. The missiles, developed by the Chungshan Institute of Science and Technology (CSIST), were originally scheduled to launch on Tuesday last week, after the Tomb Sweeping Day holiday long weekend, but were postponed to yesterday due to weather conditions. Local residents and military enthusiasts gathered outside the base to watch the missile tests, with the first one launching at 9:10am. The Land Sword II system, which is derived from the Sky Sword II (天劍二) series, was turned