NYMEX crude settles $1.33 lower in conjunction with heating oil

February crude futures on the New York Mercantile Exchange settled $1.33/bbl lower at $42.12/bbl Monday in conjunction with a sharp sell-off in the heating oil contract. Abnormally warm temperatures at the start of peak demand season has alleviated concerns about insufficient supply. "Refiners can be very happy with the volume of distillates they have been able to sell over the past few months at very strong prices, but consumers have to be feeling some remorse at having put so many eggs into the bullish basket," Tim Evans, energy analyst at IFR Energy Services, said in a report. "Weather forecasters didn't help either, with their frequent warnings of colder-than-normal temperatures that have been largely off the mark so far this winter." February heating oil settled 6.04 cts lower at $1.1922/gal, the lowest settlement since Sep 10.

February unleaded gasoline settled 12 points lower at $1.1317, benefitting from inter-market spreading as the gas-to-heat spread narrowed by 9 cts.