Oil Trading Volatile, Prices End Mixed

Oil prices ended mixed in volatile trading Tuesday on the New York Mercantile Exchange as traders squared their positions on the last day of trading in July contracts.

West Texas Intermediate--the benchmark U.S. crude--sank $1.33 to $19.53 a barrel for July delivery, compared to Monday’s close of $20.86 a barrel. Gasoline rose, but home-heating oil declined.

On the U.S. Gulf Coast spot market, where oil is sold to the highest bidder, West Texas Intermediate rose 55 cents to $20.65 a barrel.

Analysts said WTI prices skidded on the Merc as market participants scrambled to honor delivery commitments for expiring July contracts and to switch their interests into later contract months.

“We saw some active liquidation of the July contract,” said Steve Platt, senior energy analyst at Dean Witter Reynolds Inc. in Chicago.

Analysts said trading volume was light to moderate and WTI fluctuated in price by more than $2.25 a barrel during the session.

Platt said crude prices for later months also slipped because traders decided that despite the potential for a supply squeeze that buoyed WTI crude prices last week, other crudes would be available to take up the slack.