By OGJ editors
HOUSTON, Dec. 21 -- Energy prices fell Dec. 20 after meteorologists over the weekend reversed their previous predictions of extended frigid weather for the Mid-Continental and Northeastern US.
Analysts said they expect energy prices to seesaw up and down with winter temperatures over the next few weeks.
Meanwhile, a Dec. 21 rocket attack on a mess tent at a military base near Mosul, Iraq, killed 24 solders and civilians and wounded more than 60 others. Escalating violence in Iraq could trigger market concerns about the security of Middle East oil sources.
The January contract for natural gas plunged by 50.5¢ to $6.95/MMbtu Dec. 20 on the New York Mercantile Exchange, wiping out gains from the previous session. That market was "undermined by steady selling after previous forecasts of a sustained arctic blast to the northern US were moderated to a milder outlook over the weekend. "Traders were caught off guard by the milder forecast," said analysts at Enerfax Daily. "Despite a brief warm up, forecasters are still looking for a longer-term change to colder weather."
Other energy commodities managed to keep at least part of their previous gains. The January contract for benchmark sweet, light crudes lost 64¢ to $45.64/bbl on NYMEX, while the February contract fell by 79¢ to $45.78/bbl. On the US spot market, West Texas Intermediate at Cushing, Okla., was down by 64¢ to $45.65/bbl. Heating oil for January delivery dropped 4.07¢ to $1.40/gal on NYMEX; gasoline for the same month was down by 3.79¢ to $1.15/gal.
In London, the February contract for North Sea Brent crude lost 94¢ to $42.45/bbl on the International Petroleum Exchange.
The average price for the Organization of Petroleum Exporting Countries' basket of seven benchmark crudes gained 47¢ to $38.34/bbl on Dec. 20.