Crude futures top $58/bbl in New York market

Sam Fletcher
Senior Writer

HOUSTON, Feb. 1 -- Energy prices generally shot up Jan. 31 with the front-month crude price closing above $58/bbl at the highest level since the start of 2007 amid forecasts for continued cold weather in the US Midwest and Northeast.

Earlier that day, the US Energy Information Administration said US distillate fuel inventories fell by 2.6 million bbl to 140 million bbl in the week ended Jan. 26, with a drop in heating oil offsetting a rise in diesel fuel. That marked the first decline in distillate inventory in 7 weeks. US crude inventories increased for the third week, up by 2.5 million bbl to 324.9 million bbl. Gasoline stocks jumped by 3.8 million bbl to 224.6 million bbl in the same period (OGJ Online, Jan. 31, 2007).

"The gasoline stock build was higher than expected due to high imports, but the gasoline demand was very robust while the cold weather started to draw down heating oil stocks in the Northeast," said Olivier Jakob, managing director of Petromatrix GMBH, Zug, Switzerland.

EIA data were again "used as a buying opportunity for the third week in a row" in the New York market, Jakob said. The positive momentum of the current oil market "has been now more clearly defined" and would require a new breakthrough of market support at $55/bbl before being reversed, he said. Expiration of the February contracts for petroleum products on the New York market also contributed to the volatility of prices during the Jan. 31 trading session.

Moreover, Jakob said, "The dollar has weakened and gold was firmer ahead of crude oil. Gold has now broken the $650[/troy oz.] resistance." Continued geopolitical uncertainties in the Middle East should reinforce the need of crude oil as an asset hedge, especially as crude remains under priced vs. gold."

Except for Iraq, which is still struggling to regain prewar production levels, and new member Angola, which was not a party to the December agreement, the other 10 OPEC members are scheduled to reduce their total crude production by 500,000 b/d effective Feb. 1. That possibility almost certainly had some effect on Jan. 31 energy markets. However, analysts in the Houston office of Raymond James & Associates Inc. estimated OPEC members have cut only 750,000 b/d of the 1.2 million b/d of crude that they earlier pledged to reduce, effective December.

Energy prices
The March contract for benchmark US sweet, light crudes gained $1.17 to $58.14/bbl Jan. 31 on the New York Mercantile Exchange. The April contract escalated by $1.19 to $58.85/bbl. On the US spot market, West Texas Intermediate at Cushing, Okla., increased by $1.17 to $58.15/bbl. Heating oil for February delivery advanced by 1.66¢ to $1.65/gal on NYMEX. However, the February contract for reformulated blend stock for oxygenate blending (RBOB) lost 2.04¢ to $1.50/gal.

The March natural gas contract declined by 7.3¢ to $7.67/MMbtu on NYMEX. On the US spot market, however, gas at Henry Hub, La., climbed by 48¢ to $7.78/MMbtu. EIA reported Feb. 1 the withdrawal of 186 bcf of natural gas from US underground storage for the week ended Jan. 26. That was below the consensus of Wall Street analysts and compared with withdrawals of 179 bcf the previous week and 88 bcf in the same period last year. Gas storage is now at 2.6 tcf, 152 bcf more than a year ago and 454 bcf above the 5-year average. "Consistent cold weather remains the name of the game" in the gas market, said Raymond James analysts.

In London, the March IPE contract for North Sea Brent crude gained $1.01 to $57.40/bbl. Gas oil for February jumped by $19 to $511.75/tonne.

The average price for OPEC's basket of 11 benchmark crudes escalated by $1.80 to $52.52/bbl on Jan. 31.

Contact Sam Fletcher at

Related Articles

PBF Energy, PBF Logistics make management changes

12/12/2014 Matthew Lucey, currently executive vice-president of PBF Energy Inc., will succeed Michael Gayda as the company’s president. Todd O’Malley, current...

Repairs under way at ORPIC’s Muscat refinery

12/11/2014 Oman Oil Refineries & Petroleum Industries Co. (ORPIC) said it plans to resume operations at its 106,000-b/d Mina Al Fahal refinery near Muscat...

Phillips 66 advances plans for splitter at Sweeny refinery

12/11/2014 Phillips 66 has filed an application with state regulators for a permit to build a condensate splitter at its 247,000-b/d Sweeny refinery in Old Oc...

Samref wraps Yanbu refinery revamp

12/11/2014 Saudi Aramco-Mobil Refinery Co. Ltd. (Samref), a 50-50 joint venture of Saudi Aramco and ExxonMobil Corp. subsidiary Mobil Yanbu Refining Co. Inc.,...

BPCL adds petrochemicals to Kochi refinery expansion

12/09/2014 Bharat Petroleum Corp. Ltd. (BPCL), Mumbai, plans to diversify into petrochemicals production as part of the ongoing integrated expansion and upgra...

Moody's: E&P spending to dip as crude oil prices slide

12/08/2014 Weakening crude oil prices will cut exploration and production spending by independent producers in the US next year and make integrated oil and ga...

Firms' third-quarter earnings climbed amid lower crude oil prices

12/08/2014 A sample of 58 oil and gas producers and refiners based in the US recorded a combined 38% jump in profits for this year's third quarter compared wi...

Reliance expands desalination plant at Jamnagar refinery

12/05/2014 Reliance Industries Ltd. (RIL), Mumbai, is scheduled to receive proprietary PX technology from Energy Recovery Inc., San Leandro, Calif., as part o...

Start-up continues at Abreu e Lima refinery

12/05/2014 Petroleo Brasileiro SA (Petrobras) has initiated the start-up of furnaces in the atmospheric distillation unit at its Abreu e Lima refinery (Rnest)...

White Papers

AVEVA NET Accesses and Manages the Digital Asset

Global demand for new process plants, power plants and infrastructure is increasing steadily with the ...
Sponsored by

AVEVA’s Approach for the Digital Asset

To meet the requirements for leaner project execution and more efficient operations while transferring...
Sponsored by

Diversification - the technology aspects

In tough times, businesses seek to diversify into adjacent markets or to apply their skills and resour...
Sponsored by

Engineering & Design for Lean Construction

Modern marketing rhetoric claims that, in order to cut out expensive costs and reduce risks during the...
Sponsored by

Object Lessons - Why control of engineering design at the object level is essential for efficient project execution

Whatever the task, there is usually only one way to do it right and many more to do it wrong. In the c...
Sponsored by

Plant Design for Lean Construction - at your fingertips

One area which can provide improvements to the adoption of Lean principles is the application of mobil...
Sponsored by

How to Keep Your Mud System Vibrator Hose from Getting Hammered to Death

To prevent the vibrating hoses on your oilfield mud circulation systems from failing, you must examine...
Sponsored by

Duty of Care

Good corporate social responsibility means implementing effective workplace health and safety measures...
Sponsored by

Available Webcasts

On Demand

Optimizing your asset management practices to mitigate the effects of a down market

Thu, Dec 11, 2014

The oil and gas market is in constant flux, and as the price of BOE (Barrel of Oil Equivalent) goes down it is increasingly important to optimize your asset management strategy to stay afloat.  Attend this webinar to learn how developing a solid asset management plan can help your company mitigate costs in any market.


Parylene Conformal Coatings for the Oil & Gas Industry

Thu, Nov 20, 2014

In this concise 30-minute webinar, participants have an opportunity to learn more about how Parylene coatings are applied, their features, and the value they add to devices and components.


Utilizing Predictive Analytics to Optimize Productivity in Oil & Gas Operations

Tue, Nov 18, 2014

Join IBM on Tuesday, November 18 @ 1pm CST to explore how Predictive Analytics can help your organization maximize productivity, operational performance & associated processes to drive enterprise wide productivity and profitability.



Fri, Nov 14, 2014

US LNG Exports, the third in a trilogy of webcasts focusing on the broad topic of US Hydrocarbon Exports.

A discussion of the problems and potential for the export of US-produced liquefied natural gas.

These and other topics will be discussed, with the latest thoughts on U.S. LNG export policy.


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