HOUSTON, Mar. 18 -- The front-month crude futures price slipped slightly on Mar. 17 from the previous session's record closing price but not before hitting a 22-year high of $57.60/bbl in intraday trading on the New York Mercantile Exchange.
The April contract for benchmark US light, sweet crudes dipped by 6¢ to $56.40/bbl following a record finish the previous day despite a decision by the Organization of Petroleum Exporting Countries to increase immediately its production ceiling by 500,000 b/d to 27.5 million b/d.
Traders were unimpressed by that move since OPEC officials previously acknowledged current production of 27.7 million b/d among the 10 affected members, minus Iraq, which is still trying to revive its production to prewar levels (OGJ Online, Mar. 16, 2005).
Many observers still are worried about possible extreme market tightness in the second half of this year (OGJ Online, Mar. 17, 2005).
The May crude contract was down by 13¢ to $56.91/bbl Mar. 17 on NYMEX, while on the US spot market, West Texas Intermediate at Cushing, Okla., tracked the April NYMEX contract, losing 7¢ to $56.40/bbl. However, heating oil for April delivery remained unchanged at $1.59/gal on NYMEX, while gasoline for the same month climbed by 1.33¢ to $1.56/gal.
The April natural gas contract increased by 4.6¢ to $7.24/MMbtu on NYMEX, "up for the fourth day in a row on cold weather along the East Coast," said analysts at Enerfax Daily.
In London, the May contract for North Sea Brent crude increased by 18¢ to $55.06/bbl on the International Petroleum Exchange.
The average price for OPEC's basket of seven benchmark crudes continued to explore new heights, up by 98¢ to $51.76/bbl on Mar. 17.
Contact Sam Fletcher at Samf@ogjonline.com.