Light sweet crude for November delivery rose to US$64.05 per barrel in midday trade on the New York Mercantile Exchange and unleaded gasoline futures fell to US$1.99 per gallon. Recent U.S. government and industry data have shown that oil demand has dropped significantly in the past month, as motorists curb unrestricted driving.
Concerns over a slowdown in U.S. energy demand have been lingering in the market since Hurricane Katrina drove crude oil prices to a record high of US$70.85 a barrel on Aug. 30. The spike in prices can be attributed to data released by the US inventory report indicating that gasoline demand over the past month was 2.6% below year ago levels. Demand for jet fuel and distillates, such as diesel, were also lower over the same period, but by a smaller margin. Commercial inventories of crude oil fell by 300,000 barrels last week to 305.4 million barrels, putting supplies 12% above year ago levels.
Inventories for gasoline, distillate, which includes heating oil and diesel fell, as compared to last year. Distillate inventories are 4% higher than a year ago levels. Analysts attributed last week's drop in crude and gasoline inventories to Katrina and Rita, which have affected a large percentage of Gulf Coast oil production and refining.
06-Oct-05 
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