By Kenneth Fung

WASHINGTON (MNI) – U.S. petroleum inventories are expected to show
a build for the March 18 week, after having risen for eight of the past
nine weeks.

The Energy Information Administration released inventory for crude,
distillates, gasoline and jet fuel 10:30am EDT Wednesday. According to a
Platts survey of analysts, in addition to a forecasted build in crude
inventories, draws are expected in gasoline and distillate inventories.

Crude inventories are forecast to show an increase of 2,000,000
barrels after a rising by 1,745,000 barrels the previous week, and up
from a 1,012,000 barrel build in the same week a year ago.

Crude futures for May delivery, currently the most actively-traded
contract, fell below $100 last week as concerns related to Japanese
demand weighed on the market. However, tensions in Libya escalated late
in the week and the price of crude jumped over 6% from Wednesday’s close
of $97.98.

Still, Citi Futures energy analyst Tim Evans noted in a research
note that crude has not traded above the recent March 7 high ($108.25).

He added, “This suggests that the market has been ahead of events
in terms of pumping a geopolitical risk premium into the price and that
it may take more unrest across North Africa and the Middle East to send
prices higher, that or else hard evidence that the market is becoming
physically tight.”

Gasoline inventories are projected to decline for the fifth week in
a row. Estimates in the Platts survey call for a decline of 2,000,000
barrels in the March 18 week, following a 4,174,000 barrel draw the week
previous and a 1,710,000 barrel decrease in the same week one year ago.

March 21, the Department of Energy reported the average retail
price of a gallon of unleaded gasoline at $3.562, down $0.005 from the
previous week, but up $0.743 from the same week a year ago.

The Platts survey forecasts distillate inventories to decline by
1,500,000 barrels after a 2,601,000 barrel draw the previous week, and a
1,491,000 barrel drop in the same week one year ago.

–Kenneth Fung is a reporter with Need To Know News In Washington

** Market News International Washington Bureau: 202-371-2121 **

[TOPICS: M$U$$$,MI$OI$,MAUDS$]