US driving season to keep prices strong even if futures dip

Oil prices cooled off, with trading steady as fresh industry data showed swollen US crude inventories and a slim but surprising build-up in gasoline reserves. But dealers said fund buying and persistent worries over gasoline stock levels ahead of the peak demand summer driving season in the United States would keep prices strong even if futures dip.
The North Sea bellwether, Brent, stood six cents higher at $ 26.60 a barrel after a rally powered by fund buying pushed the contract up by $ 1.20. US light crude traded 31 cents lower at $ 28.17. Richard Hardy, a trader at Credit Lyonnais, said: "The price might come off a little bit but the funds will keep it strong. I am bullish on gasoline over the next two or three weeks."

New data from the US Energy Information Administration (EIA) gave the market little new direction because it was mostly in line with the American Petroleum Institute (API) figures. The EIA said US crude stocks gained 3.9 mm barrels, confirming the API's report of a 4.7 mm barrel build.
The API reported a rise in crude stocks for the fifth consecutive week, taking tanks to the highest levels since November 1999 and almost 11 mm barrels over year-ago stocks. The EIA said US gasoline stocks grew by 900,000 barrels for the week ending 6 April.
The API recorded a 315,000 barrel rise in US gasoline tanks to 192.5 mm barrels, the first build in motor fuel in seven weeks and bucking market expectations of a renewed draw. But the year-on-year deficit in gasoline stocks widened to 11.5 mm barrels, offering little comfort to American drivers who face a possible replay of last year's summer supply crunch when pump prices hit record levels.