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Energy Complex Edges Ahead

The May light sweet crude contract adds 3 cents to $63.13.

Energy futures were generally higher in Wednesday's New York session after traders weighed bullish petroleum inventory figures and rumors that

Royal Dutch Shell


may soon reopen the spigots at its Nigerian oil installations.

The May light sweet crude contract edged 3 cents higher to $63.13 a barrel. Reformulated gasoline added 2 cents to $2.08 a gallon, while heating oil was unchanged at $1.80 a gallon.

Natural gas climbed 8 cents to $7.50 per million British thermal units.

The Energy Information Administration reported that crude inventories fell by one million barrels during the week ended April 13. Analysts at Bank of America were expecting a 700,000 barrel injection.

In another clear indication that motor gasoline inventories are tight going into this year's summer driving season, the inventory report revealed that gasoline stores dropped by 2.7 million barrels during the previous week. Analysts had predicted a 900,000 barrel draw.

However, the report's high refinery utilization number kept gasoline prices in check. The EIA said refinery utilization increased by 2 percentage points to 90.4% over the previous week. The May gasoline contract plunged nearly 2% in less than 10 minutes on the news before resettling above $2 a gallon. Higher utilization rates will allow refiners to increase the amount of gasoline that they produce from crude oil.

"Gasoline demand has been abnormally high," said Ron Simpson, managing director at Action Economics. "However, the market has recently been long gasoline up to its eyeballs. As refineries come back online, we should see a cleanout of these positions."

Indeed, reformulated gasoline futures have slid nearly 5% since they topped out above $2.17 a gallon on April 13.

Still, that trend could reverse, according to Energy Secretary Samuel Bodman, who told


that expensive crude and outages at refineries could produce record U.S. gasoline prices this summer.

Meanwhile, the natural gas market got a boost after the American Stock Exchange introduced the first ETF related entirely to natural gas. The

United States Natural Gas Fund

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(UNG) - Get United States Natural Gas Fund LP Report

will correlate to the price of natural gas delivered at the Henry Hub, rather than to spot or futures markets at the New York Mercantile Exchange.

As for stocks, Royal Dutch Shell tacked on 12 cents at $69.71 amid rumors that the company plans to reopen its Forcados oil facilities in Nigeria by the end of May. The facilities have been shut-in for more than a year because of violence between government and rebel soldiers in Nigeria's oil-producing region.

The Forcados field is capable of producing over 380,000 barrels of oil a day.

Elsewhere, the

CBOE Oil Index

fell fractionally to 680.82.


(COP) - Get ConocoPhillips Report

was down 0.8% at $69.84.


(CVX) - Get Chevron Corporation Report

closed 0.2% lower at $77.77, and

Exxon Mobil

(XOM) - Get Exxon Mobil Corporation Report

dropped 0.3% to $78.20.



said it's finished looking for alternate buyers and is ready to pursue its $44 billion private equity deal with KKR. Shares of TXU edged slightly lower to $64.98.

Citigroup downgraded a swath of oil services companies to hold from buy.


(SLB) - Get Schlumberger NV Report

fell 3.3% to $74.91, and

Smith International


finished 2.9% lower at $50.15.

National Oilwell Varco

(NOV) - Get NOV Inc. Report

dropped 4% to $79.48, and

Dresser-Rand Group


slipped 2% to $31.28.

Cameron International


was 2% lower at $65.79.