MARKET WATCH
Inventory build pushes down energy prices

Sam Fletcher
Senior Writer

HOUSTON, Dec. 23 -- Energy prices fell in light trading Dec. 22 as traders reacted to a surprisingly bearish report on US petroleum inventories during the last full session before the extended Christmas holiday weekend on the New York Mercantile Exchange. NYMEX was scheduled to close early Dec. 23 and remain closed Dec. 24.

Traders had expected a slight decline in US petroleum stocks after a period of colder-than-normal weather. However, the Energy Information Administration said Dec. 22 that commercial US inventories of crude increased by 2.1 million bbl to 295.9 million bbl during the week ended Dec. 17. Distillate fuel inventories were up by only 600,000 bbl to 119.9 million bbl, while US gasoline inventories increased by 1.8 million bbl to 211.4 million bbl (OGJ Online, Dec. 22, 2004).

Meanwhile, US military officials now suspect that a suicide bomber, not a rocket attack, killed 22 solders and civilians and wounded more than 60 others in a Dec. 21 attack on a mess tent at a military base near Mosul, Iraq (OGJ Online, Dec. 21). Analysts said the Dec. 22 fall in energy commodity prices could have been steeper had it not been checked by fears of increased violence in Iraq prior to upcoming elections.

In other news, the Royal Dutch/Shell Group on Dec. 22 declared force majeure on disrupted deliveries of 114,000 b/d of Nigerian Bonny Light crude as a result of the occupation by villagers of oil platforms in the Niger Delta earlier this month. Hundreds of villagers occupied two Shell and one CheveronTexaco Corp. platforms Dec. 5 but subsequently retreated. Nevertheless, Shell said the resulting production stoppage would impact export operations through the rest of December, January, and part of February.

Energy prices
The January contract for benchmark US light, sweet crudes fell by $1.52 to $44.24/bbl Dec. 22 on NYMEX, while the February position lost $1.46 to $44.33/bbl. On the US spot market, West Texas Intermediate at Cushing, Okla., was down by $1.51 to $44.05/bbl. Heating oil for January delivery dropped 4.09¢ to $1.36/gal on NYMEX. Gasoline for the same month retreated by 2.13¢ to $1.15/gal. The January natural gas contract dipped by 3.6¢ to $6.82/MMbtu.

In London, the February contract for North Sea Brent crude lost $1.73 to $40.56/bbl Dec.22 on the International Petroleum Exchange.

The average price for the Organization of Petroleum Exporting Countries' basket of seven benchmark crudes declined by 85¢ to $37.41/bbl on Dec. 22.

Contact Sam Fletcher at samf@ogjonline.com

Related Articles

MARKET WATCH: Crude oil futures rise on Libya, Ukraine concerns

04/10/2014 Crude oil futures prices reached a 5-week high on the New York market Apr. 9 amid continued uncertainty about apparent delays in an anticipated res...

FRA to propose requiring two-member crews on trains carrying crude

04/10/2014 The Federal Railroad Administration (FRA) plans to propose requiring trains transporting crude oil to have at least two crew members, the US Depart...

MARKET WATCH: NYMEX oil price jumps on EIA’s reduced oil production forecast

04/09/2014 The benchmark US crude oil futures price jumped more than $2/bbl on Apr. 8 after the US Energy Information Administration released a report saying ...

Russia falls to last place in SAFE’s latest Oil Security Index

04/08/2014 Russia, which ranked as high as No. 9 in 2005, fell to last place in the most recent quarterly update of the global Oil Security Index (OSI), relea...

Careers at TOTAL

Careers at TOTAL - Videos

More than 600 job openings are now online, watch videos and learn more!

 

Click Here to Watch

Other Oil & Gas Industry Jobs

Search More Job Listings >>
Stay Connected