By OGJ editors
HOUSTON, Nov. 13 -- Oil futures prices continued to pull back Nov. 12 following reports that the International Energy Agency had revised downward by 500,000 b/d its forecast for global oil demand for the fourth quarter. In its November Oil Market Report, IEA cited "higher prices, weaker than expected data from the US and the former Soviet Union, and delays to European heating oil restocking" for its downward revision.
IEA also cut its global oil demand forecast for 2008. "Coupled with lower [gross domestic production] growth, these [downward] revisions extend to the 2008 forecast, which has been adjusted down by 300,000 b/d," IEA said. World demand now averages 85.7 million b/d in 2007 and 87.7 million b/d in 2008, the agency reported.
Natural gas prices, meanwhile, were up slightly following forecasts that colder weather would be moving into key consuming regions in the US, said analysts with Raymond James & Associates Inc. "This is expected to boost demand for heating and may lead to the first withdrawal of the season," they said, adding, "According to the Climate Prediction Center, temperatures in states along the northern tier of the US are expected to be below normal for this time of year over the next 14 days."
The December contract for benchmark US light, sweet crudes closed down $1.70 at $94.62/bbl Nov. 12 on the New York Mercantile Exchange. The January contract lost $1.78 to $93.52/bbl. On the US spot market, WTI at Cushing, Okla., was down $1.70 to $94.63. The December contract for reformulated blend stock for oxygenate blending (RBOB) fell 3.95¢ to $2.42/gal on NYMEX. Heating oil for the same month fell 3.67¢ to $2.58/gal.
The December natural gas contract increased 6¢ to $7.96/MMbtu on NYMEX. On the US spot market gas at Henry Hub, La., gained 19¢ to $6.85/MMbtu.
In London, the December IPE contract for North Sea Brent crude lost $1.20 to $91.98/bbl. However, the November gas oil contract lost $40.25 to $791.25/tonne.
The average price for OPEC's basket of 12 reference crudes fell 91¢ to $88.80/bbl on Nov. 12. So far this year, OPEC's basket price has averaged $66.25/bbl, up from $61.08/bbl for all of 2006.