MARKET WATCH: Energy prices continue to fluctuate; oil declines

Sam Fletcher
OGJ Senior Writer

HOUSTON, Jan. 20 -- Energy prices were mixed and continued to fluctuate Jan. 19 with some commodities regaining part of their losses from the previous session and some losing part of their gains in the New York market.

“With oil once again flowing freely through the Trans-Alaska Pipeline, crude dropped 0.6%,” said analysts in the Houston office of Raymond James & Associates Inc. However, natural gas rose 3.1% on forecasts for colder weather and expectations the government would report a larger-than-average withdrawal of gas from US storage.

“Concerns that the economic recovery might be slowing weighed on the broader market, as the Standard & Poor's 500 Index fell 1% and the Dow Jones Industrial Average closed slightly lower,” they said. “Energy stocks followed the broader market and crude into the red.”

James Zhang at Standard New York Securities Inc., the Standard Bank Group, said, “The US housing start number yesterday came in worse than expected, which the oil market largely brushed aside. However, the US weekly jobless claims number will be closely watched today after a sharp increase in number of claimants last week. The market has been trading sideways for over a week, and in a very narrow range following the jump on the back of Alaska pipeline outage. The market is looking heavy and may be due for a correction.”

With the price of West Texas Intermediate down Jan. 19 in New York and North Sea Brent’s value up, the spread between the two benchmark crudes widened to $6.35/bbl in Brent’s favor.

“With the very strong premium of Brent vs. WTI and the dollar stronger than in the first half of 2008, the average domestic gasoline price in Europe (including duties and tax) is now at the highest level since the spring of 2008 and only a few points off the all time highs of the summer of 2008,” reported Olivier Jakob at Petromatrix, Zug, Switzerland. “Unemployment in Europe is at 10.1%, and if everything is fine in Germany, the peripheries have to engage in austerity (more talks about Greece having to restructure the debt), and we will have to see how consumption deals with the higher driving fuel prices.”

Data starting to come out for December show a strong decline in consumption, “but a lot of that has probably been due to the bad weather (chaos on roads due to snow during December), making it difficult for now to distinguish between the snow and the price impact,” Jakob said.

US inventories
The Energy Information Administration reported Jan. 20 the withdrawal of 243 bcf of natural gas from US underground storage in the week ended Jan. 14, exceeding the Wall Street consensus of 230 bcf. That left 2.7 tcf of gas in storage, 74 bcf more than at this period last year and 51 bcf above the 5-year average.

In a separate report delayed 1 day because of the US holiday this week, EIA said commercial US crude inventories increased 2.6 million bbl to 335.7 million bbl last week. The Wall Street consensus was for a decline of 500,000 bbl. Gasoline stocks jumped by 4.4 million bbl to 227.7 million bbl, outstripping a consensus for a 2.5 million bbl build. Finished gasoline inventories decreased while blending components inventories increased. Distillate fuel inventories climbed by 1 million bbl to 165.8 million bbl, exactly as analysts had predicted.

The import of crude into the US increased by 140,000 b/d to 9 million b/d last week, EIA reported. In the 4 weeks through Jan. 14, US crude imports averaged 8.8 million b/d, which was 334,000 b/d more than in the comparable period a year ago. Gasoline imports averaged 722,000 b/d while distillate fuel imports averaged 241,000 b/d last week, EIA said.

The input of crude into US refineries was up 389,000 b/d to 14.3 million b/d last week with units operating at 83% of capacity. Gasoline production increased to 8.9 million b/d. Distillate fuel production decreased to 4.4 million b/d.

Energy prices
Crude prices continued to decline Jan. 19 on the New York Mercantile Exchange with the February contract for benchmark US light, sweet crudes down 52¢ to $90.86/bbl. The March contract dropped 50¢ to $91.81/bbl.

On the US spot market, WTI at Cushing, Okla., was down 52¢ to $90.86/bbl. Heating oil for February delivery increased 1.03¢ to $2.66/gal on NYMEX. Reformulated blend stock for oxygenate blending for the same month continued inching higher, up 0.24¢ to $2.48/gal.

The February natural gas contract rebounded, gaining 13.6¢ to $4.56/MMbtu on NYMEX. On the US spot market, gas at Henry Hub, La., registered a small increase, 0.7¢ to $4.49 MMbtu.

In London, the March IPE contract for North Sea Brent crude turned around in the latest session, up 36¢ to $98.16/bbl. Gas oil for February continued climbing, up $3.25 to $821.25/tonne.

The average price for the Organization of Petroleum Exporting Countries' basket of 12 reference crudes was up again, 19¢ to $93.99/bbl.

Contact Sam Fletcher at samf@ogjonline.com.

Related Articles

Inhofe, Lankford say new BIA rules threaten Osage oil operations

07/10/2015 New US Bureau of Indian Affairs regulations that increase production expenses on tribal lands could put the Osage Nation out of business, Oklahoma’...

House panel’s crude export ban hearing weighs urgency against caution

07/10/2015 A US House Energy and Commerce subcommittee hearing on legislation to repeal the ban on exporting US-produced crude oil quickly broke along party l...

Chevron Phillips Chemical makes executive appointments

07/10/2015

Chevron Phillips Chemical Co. LLC has made several executive appointments, all effective Aug. 1.

Twelve workers killed in Nigeria pipeline explosion

07/10/2015 Eni SPA reported that an explosion occurred July 9 at the repair site for the Tebidaba-Clough Creek oil pipeline in Nigeria’s onshore Niger Delta.

Gov. Tomblin forms West Virginia oil, gas safety commission

07/10/2015 West Virginia Gov. Earl Ray Tomblin (D) established the oil and gas safety commission he announced in his 2015 State of the State address. The grou...

MARKET WATCH: NYMEX, Brent crude oil prices rebound more than $1/bbl

07/10/2015 Prices for US light, sweet crude oil and Brent crude each rebounded by more than $1/bbl on their respective markets July 9, and analysts attributed...

Transco seeks FERC approval for New York Bay Expansion project

07/09/2015 Transcontinental Gas Pipe Line Co. LLC (Transco), a wholly owned subsidiary of Williams Partners LP, has filed an application with the US Federal E...

House Oversight panel subpoenas Kerry for Keystone XL documents

07/09/2015 The US House Oversight and Government Reform Committee issued a subpoena to US Sec. of State John F. Kerry for reports, recommendations, letters, a...

MARKET WATCH: NYMEX crude oil prices drop for fifth consecutive trading session

07/09/2015 US light, sweet crude oil prices settled slightly lower on the New York market July 8 for the fifth consecutive trading session, and analysts attri...
White Papers

2015 Global Engineering Information Management Solutions Competitive Strategy Innovation and Leadership Award

The Frost & Sullivan Best Practices Awards recognise companies in a variety of regional and global...
Sponsored by

Three Tips to Improve Safety in the Oil Field

Working oil fields will always be tough work with inherent risks. There’s no getting around that. Ther...
Sponsored by

Pipeline Integrity: Best Practices to Prevent, Detect, and Mitigate Commodity Releases

Commodity releases can have catastrophic consequences, so ensuring pipeline integrity is crucial for p...
Sponsored by

AVEVA’s Digital Asset Approach - Defining a new era of collaboration in capital projects and asset operations

There is constant, intensive change in the capital projects and asset life cycle management. New chall...
Sponsored by

Transforming the Oil and Gas Industry with EPPM

With budgets in the billions, timelines spanning years, and life cycles extending over decades, oil an...
Sponsored by

Asset Decommissioning in Oil & Gas: Transforming Business

Asset intensive organizations like Oil and Gas have their own industry specific challenges when it com...
Sponsored by

Squeezing the Green: How to Cut Petroleum Downstream Costs and Optimize Processing Efficiencies with Enterprise Project Portfolio Management Solutions

As the downstream petroleum industry grapples with change in every sector and at every level, includin...
Sponsored by

7 Steps to Improve Oil & Gas Asset Decommissioning

Global competition and volatile markets are creating a challenging business climate for project based ...
Sponsored by
Available Webcasts

On Demand

OGJ's Midyear Forecast 2015

Fri, Jul 10, 2015

This webcast is to be presented by OGJ Editor Bob Tippee and Senior Economic Editor Conglin Xu.  They will summarize the Midyear Forecast projections in key categories, note important changes from January’s forecasts, and examine reasons for the adjustments.

register:WEBCAST


Predictive Analytics in your digital oilfield - Optimize Production Yield and Reduce Operational Costs

Tue, Jul 7, 2015

Putting predictive analytics to work in your oilfield can help you anticipate failures, plan and schedule work in advance, eliminate emergency work and catastrophic failures, and at the same time you can optimize working capital and improve resource utilization.  When you apply analytic capabilities to critical production assets it is possible to reduce non-productive time and increase your yield.

Learn how IBM's analytics capabilities can be applied to critical production assets with the goal of reducing non-productive time, increasing yield and reducing operations costs.

register:WEBCAST


Cognitive Solutions for Upstream Oil and Gas

Fri, Jun 12, 2015

The oil & gas sector is under pressure on all sides. Reserves are limited and it’s becoming increasingly expensive to find and extract new resources. Margins are already being squeezed in an industry where one wrong decision can cost millions. Analyzing data used in energy exploration can save millions of dollars as we develop ways to predict where and how to extract the world’s massive energy reserves.

This session with IBM Subject Matter Experts will discuss how IBM Cognitive Solutions contribute to the oil and gas industry using predictive analytics and cognitive computing, as well as real time streaming for exploration and drilling.

register:WEBCAST


The Alternative Fuel Movement: Four Need-to-Know Excise Tax Complexities

Thu, Jun 4, 2015

Discussion on how to approach, and ultimately embrace, the alternative fuel market by pulling back the veil on excise tax complexities. Taxes may be an aggravating part of daily operations, but their accuracy is crucial in your path towards business success.

register:WEBCAST


Emerson Micro Motion Videos

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