HOUSTON, Dec. 27 -- Energy commodities prices generally continued to slide Dec. 23 because of revised forecasts for milder winter weather and bearish reports of US inventories of crude and petroleum products.
But snowstorms lashed much of the US over the Christmas weekend, triggering power outages in Massachusetts and stranding travelers along icy highways in North Carolina. Winter storms even delivered inches of snow on Dec. 24 in Houston and other parts of South Texas that hadn't seen snow in 80 years or more. Although most of the snow melted the next day, it triggered memories of the hard freeze in 1989 that disrupted natural gas production in Texas and other producing states, shut down some Gulf Coast refineries, and curtailed shipments of heating oil, natural gas liquids, and liquid petroleum products to US markets.
So far, there have been no apparent disruptions of energy supplies by cold weather this year. But this winter may have that potential if weather turns colder than normal.
Meanwhile, rescuers reported more than 22,000 people were killed in 10 countries Dec. 26 after a magnitude-9 earthquakethe world's most powerful in 4 decadesstruck beneath the Indian Ocean off the coast of Indonesia. The quake triggered towering tsunamis that crashed into the coasts of several Asian countries, resulting in widespread death and destruction. There was no immediate indication of whether production of oil and natural gas was disrupted in that region or the potential impact on those markets.
The January contract for benchmark US sweet, light crudes lost 6¢ to $44.18/bbl on Dec. 23 on the New York Mercantile Exchange. Heating oil for January delivery was down by 3.24¢ to $1.33/gal, while gasoline for the same month declined by 1.63¢ to $1.13/gal. The January natural gas contract plunged by 15.2¢ to $6.67/MMbtu, its fourth loss in as many consecutive sessions. NYMEX closed early Dec. 23 and remained closed Dec. 24 for the Christmas holiday.
In London, the February contract for North Sea Brent crude lost 7¢ to $40.71/bbl on the International Petroleum Exchange, which is to remain closed until Dec. 29.
The average price for the Organization of Petroleum Exporting Countries' basket of seven benchmark crudes dipped by 13¢ to $36.58/bbl Dec. 24. For the week as a whole, however, the average price for OPEC's basket, increased by $2.67 to $37.72/bbl. So far this year, OPEC's basket price has averaged $36.05/bbl, up from $28.10/bbl for all of 2003.
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