MARKET WATCH: Stronger consumer data lift energy prices

Energy prices generally posted small gains in reaction to strong consumer data Mar. 13, recovering some of the loss from the previous session. The front-month natural gas contract was up 1% in the New York market.

“Oil was boosted by the slightly more positive outlook on the US economy from the US Federal Reserve,” said James Zhang at Standard New York Securities Inc., the Standard Bank Group. “The market was also lifted by the buoyant equity market in the US and Europe, although the bullishness in oil was partially offset by a stronger US dollar.”

Petroleum products slightly outperformed crude as the American Petroleum Institute reported sizeable draws on product inventories and a build in crude stocks. “As we expected, time spreads at the front-end of Brent curve continued to weaken due to poor refining margins in Europe and the upcoming spring maintenance season,” Zhang said.

In its latest monthly oil market report, Paris-based International Energy Agency kept its demand projection unchanged for 2012 at 800,000 b/d above the 2011 level. “However, the focus remains on the supply side of the market, as the agency thinks that Iranian exports could fall by 1 million b/d from July, and spare capacity from Saudi Arabia dropped to 1.9 million b/d in February,” said Zhang. “Non-OPEC production during the first quarter also was disappointing. As tight supply drove crude prices up, product prices have been lagging, which saw on average margins for European refineries halved in February from January. This morning it was reported that Total SA has partially shut down its refinery at Gonfreville in Normandy, France, due to poor refining margins.”

The Euro remains under pressure. “The strength in the Dollar Index and Brent at $126/bbl means that in Europe new all-time record high prices at the pump will be printed,” said Olivier Jakob at Petromatrix in Zug, Switzerland. “The same goes for China, which according to its price mechanism formula should soon go through another price increase at the pump, also to a new all-time record high. To reassure those customers, the Saudi oil minister made statements again today that Saudi Arabia stands ready to supply more oil to the market but not now because supply is ample and because the current prices are the result of excessive speculation. Exactly the same thing was said by Saudi Arabia at the same time of the year in 2008. When Saudi Arabia decided to act in 2008, it was already too late for the world economy.”

US inventories

The Energy Information Administration reported Mar. 14 commercial US inventories of crude increased 1.8 million bbl to 347.5 million bbl in the week ended Mar. 9. Gasoline stocks dropped 1.4 million bbl to 228.1 million bbl. Finished gasoline inventories decreased while blending components remained unchanged. Distillate fuel inventories fell 4.7 million bbl to 134.8 million bbl.

Imports of crude into the US inched up 4,000 b/d to 8.7 million b/d last week. In the 4 weeks through Mar. 9, crude imports into the US averaged 8.9 million b/d, up 653,000 b/d compared with the same period a year ago. Gasoline imports last week averaged 532,000 b/d. Distillate fuel imports averaged 141,000 b/d.

The input of crude into US refineries declined by 126,000 b/d to 14.5 million b/d last week with units operating at 82.7% of capacity. Gasoline production increased to 8.8 million b/d, but distillate fuel production decreased to 4.1 million b/d.

Energy prices

The April contract for benchmark US light, sweet crudes increased 37¢ to $106.71/bbl Mar. 13 on the New York Mercantile Exchange. The May contract gained 40¢ to $107.24/bbl. On the US spot market, West Texas Intermediate at Cushing, Okla., was up 37¢ to $106.71/bbl.

Heating oil for April delivery increased 2.83¢ to $3.27/gal on NYMEX. Reformulated stock for oxygenate blending for the same month advanced 3.16¢ to $3.35/gal.

The April natural gas contract was up 3¢ to $2.30/MMbtu on NYMEX. On the US spot market, gas at Henry Hub, La., lost 1.5¢ to $2.15/MMbtu.

In London, the April IPE contract for North Sea Brent climbed 88¢ to $126.22/bbl. The new front-month April gas oil contract escalated by $8.25 to $1,036.50/tonne.

The average price for the Organization of Petroleum Exporting Countries’ basket of 12 benchmark crudes gained 71¢ to $124.59/bbl.

Contact Sam Fletcher at samf@ogjonline.com.

Related Articles

Senators’ bill aims to curb flaring by expediting permit process

02/09/2015 North Dakota and Wyoming’s US senators introduced legislation that aims to capture methane and reduce flaring by expediting procedures for obtainin...

USW union workers add two BP refineries to strike list

02/09/2015 Union workers at two BP PLC-owned refineries in Indiana and Ohio have joined the United Steelworkers union’s (USW) unfair labor practice (ULP) stri...

Bendine elected as Petrobras’ chief executive officer

02/09/2015

The board of Petroleo Brasileiro SA (Petrobras) has approved the election of Alde Mir Bendine as the company’s chief executive officer.

Central starts gas sales from Palm Valley field

02/09/2015 Central Petroleum Ltd., Brisbane, is to start sale of early natural gas from Palm Valley field to Northern Territory Power & Water Corp. under ...

Association presidents want more access in next 5-year OCS plan

02/09/2015 The presidents of three major US oil and gas trade associations urged the US Bureau of Ocean Energy Management to keep more of the US Outer Contine...

MARKET WATCH: NYMEX oil prices settle above $51/bbl

02/09/2015 Crude oil prices rose on the New York market Feb. 6 to settle above $51/bbl after the Baker Hughes Inc. weekly rig count showed a decline of 87 rig...

Statoil reduces capital budget by $2 billion following 4Q losses

02/06/2015 Statoil ASA has reduced its organic capital expenditure to $18 billion in 2015 from $20 billion in 2014. The move comes on the heels of a fourth qu...

Chinese regulators approve Sinopec’s plan for grassroots refinery

02/06/2015 China’s National Development and Reform Commission (NDRC) has approved Sinopec Beijing Yanshan Petrochemical Co. Ltd., a subsidiary of China Nation...

BOEM schedules public meetings about draft proposed 5-year OCS plan

02/06/2015 The US Bureau of Ocean Energy Management will hold the first of 20 public meetings in Washington on Feb. 9 to receive public comments on potential ...
White Papers

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

The impact of aging infrastructure in process manufacturing industries

Process manufacturing companies in the oil and gas, utilities, chemicals and natural resource industri...
Sponsored by
Available Webcasts


OGJ's Midyear Forecast 2015

When 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

When 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



On Demand

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