Doubts about the strength of demand for gasoline forced crude oil futures prices below $14 a barrel Monday.
Gasoline futures fell even more sharply, for a time touching the 2 cents-a-gallon limit decline allowed for daily trading on the New York Mercantile Exchange.
The market opened with vigorous selling from all sides, "but it looked more ominous than it really was," said Richard Marose, an analyst in Chicago with Geldermann Inc. "They broke through the $14 support in the first hour and then the selloff stalled out."
Gasoline stocks, which a few weeks back were said to be a little tight, are no longer a problem, he said. For the last three reporting weeks, the American Petroleum Institute recorded increased stocks of gasoline. The next report, which will include the Memorial Day weekend and should provide an important clue about summer driving intentions, comes out late Tuesday.
While logic would dictate a sizable increase in gasoline demand now, "we have yet to see any numbers to support that," said Peter Beutel, an analyst in New York with Rudolf Wolff Energy.
"So we're starting to see a little disappointment in the market," he said.