MARKET WATCH: Crude oil price dips, ending seven-session rally

The front-month crude contract price dipped slightly Sept. 12 in the New York futures market, ending a seven-session rally. Natural gas continued climbing, however, with the front-month contract closing above $3/MMbtu.

The euro rose to a 4-month high against the US dollar after Germany’s Constitutional Court approved that country’s involvement in the Euro-zone rescue fund. The euro maintained that lead in early trading Sept. 13 while the dollar dropped to a 7-month low against the yen, based apparently on market expectations Federal Reserve System officials will announce a third round of monetary stimulus at the end of its 2-day meeting.

Many analysts say the Fed is now more likely to try a third round of government bond purchases to reduce borrowing costs and stimulate the economy following weak jobs and other data this week.

The US Department of Labor reported Sept. 13 that 382,000 initial applications for unemployment benefits were filed last week, an increase of 15,000 from the previous week. Government officials blamed the gain at least partially on Hurricane Isaac.

The number of people receiving unemployment aid fell by 80,000 to 5.4 million in the week ending Aug. 25, according to the latest available data. The decline was credited primarily to many recipients having exhausted available benefits.

The unemployment rate dropped to 8.1% from 8.3%, due to the number of people dropped from unemployment rolls because they have given up on finding jobs. Only 96,000 jobs were added in August, down from 141,000 in July and below a monthly average of 226,000 in the first quarter.

DOL also reported wholesale prices jumped 1.7% in August primarily because of a 13.6% hike in gasoline prices, the largest gain in 3 years. Food prices were up 0.9% and are likely to climb higher in coming months because of the drought across the Midwest.

US inventories

The Energy Information Administration reported the injection of 27 bcf of natural gas into US underground storage in the week ended Sept. 7. That raised working gas in storage to 3.429 tcf. That’s 342 bcf more than gas storage in the comparable period last year and 284 bcf above the 5-year average.

EIA earlier reported commercial US crude inventories increased 2 million bbl to 359.1 million bbl last week, an above-average total for this time of year. Analysts were expecting a “relatively strong” draw of 2.9 million bbl. Gasoline stocks fell 1.2 million bbl to 197.7 million bbl in the same period, less than the 1.7 million bbl draw some expected. Finished gasoline increased while blending components decreased. Distillate fuel inventories rose 1.5 million bbl to 128.6 million bbl, yet remained below average. Analysts were expecting a 500,000 bbl dip (OGJ Online, Sept. 12, 2012).

Energy prices

The October and November contracts for benchmark US sweet, light crudes dipped 16¢ each to respective closings of $97.01/bbl and $97.34/bbl Sept. 12 on the New York Mercantile Exchange. On the US spot market, West Texas Intermediate at Cushing, Okla., was down 16¢ to $97.01/bbl.

Heating oil for October delivery increased 2.95¢ to $3.22/gal on NYMEX. Reformulated stock for oxygenate blending for the same month, however, dropped 4.19¢ to $3/gal.

The October natural gas contract continued to rally, up 7.1¢ to $3.06/MMbtu on NYMEX. On the US spot market, gas at Henry Hub, La., climbed 10.6¢ to $2.94/MMbtu.

In London, the October IPE contract for North Sea Brent advanced 56¢ to $115.96/bbl. Gas oil for September was unchanged at $996.50/tonne.

The average price for the Organization of Petroleum Exporting Countries’ basket of 12 benchmark crudes gained 68¢ to $113.36/bbl.

Contact Sam Fletcher at samf@ogjonline.com.

Related Articles

EPA approves Magellan’s Corpus Christi splitter project

12/12/2014 The US Environmental Protection Agency has issued a final greenhouse gas prevention of significant deterioration construction permit to Magellan Pr...

Keyera to take majority interest in Alberta gas plant

12/12/2014 Keyera Corp., Calgary, will pay $65 million (Can.) to buy a 70.79% ownership interest in the Ricinus deep-cut gas plant in west-central Alberta.

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...

TAEP: TPI still peaking, but ‘contraction unavoidable’ as oil prices fall

12/12/2014 The Texas Petro Index (TPI), a composite index based on a comprehensive group of upstream economic indicators released by the Texas Alliance of Ene...

MARKET WATCH: NYMEX crude oil price extends slump

12/12/2014 Crude oil prices extended their slump on the New York market with a Dec. 11 settlement of less than $60/bbl for January, and prices continued downw...

US needs more data before ending crude export ban, House panel told

12/11/2014 Much more environmental impact information is needed before the US can reasonably remove crude oil export limits, a witness told a House Energy and...

BOEM raises offshore oil spill liability limit to $134 million

12/11/2014 The US Bureau of Ocean Energy Management increased the liability limit for oil-spill related damages from offshore operations to $134 million from ...

Rosneft, Essar sign terms of oil supply agreement

12/11/2014 OAO Rosneft and Essar Energy PLC have signed key terms of an oil supply agreement in New Delhi. Rosneft said shipments to India may begin in 2015.

Barton introduces bill to remove US crude export limits

12/11/2014

US Rep. Joe Barton (R-Tex.) introduced legislation that would remove US crude oil export limits that have been in place for nearly 40 years.

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.

register:WEBCAST


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.

register:WEBCAST


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.

register:WEBCAST


US HYDROCARBON EXPORTS Part 3 — LNG

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.

register:WEBCAST


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