MARKET WATCH: Energy prices mixed in directionless markets

Energy prices were mixed Oct. 16 with the front-month US benchmark crude contract up just 0.3% in the New York market but North Sea Brent down 0.6% amid reports of inflated production by Saudi Arabia.

“West Texas Intermediate was buoyed by the general optimism that overtook markets yesterday,” said Marc Ground at Standard New York Securities Inc., the Standard Bank Group. Investors’ appetite for risk investments improved on encouraging data on US industrial production and manufacturing activity, reports of higher third quarter earnings among some key corporations, and heightened expectations that Spain will request a bailout from other European countries, he said.

The European Union summit scheduled Oct. 18-19 in Brussels has “encouraged optimism that progress will be made on solving the region’s fiscal crisis—significant progress to our mind is doubtful—proving support for the euro and consequently lifting most dollar-denominated commodities,” Ground said.

“Brent largely ignored the optimism of the day,” he said. “Perhaps markets, like we do, felt the premium over WTI has been a bit extreme and not warranted, given the current supply outlook (yesterday, the premium closed $1/bbl lower). Nevertheless, geopolitical risks, while perhaps over-exaggerated these past few days, are still a concern. This should keep the spread between the two benchmarks from narrowing too significantly.”

In Houston, analysts at Raymond James & Associates Inc. said, “Markets have not picked a general direction that will be dictated by the earnings season, as fears of a rough quarter were countered with solid results from several bellwether companies yesterday.” Broader equity markets reacted with a “hefty 1% gain” from the Dow Jones Industrial Average and Standard & Poor’s 500 Index. Energy stocks rode the corporate earnings wave, sending the SIG Oil Exploration & Production Index and Oil Service Index up 1.6% and 1.7%, respectively, Raymond James reported.

US inventories

The Energy Information Administration said Oct. 17 commercial US crude inventories climbed 2.9 million bbl to 369.2 million bbl in the week ended Oct. 12, nearly twice the Wall Street consensus for a 1.5 million bbl gain. Gasoline stocks were up 1.7 million bbl to 197.1 million bbl in the same period, primarily because of increased blending components and far exceeding the cumulative 500,000 bbl gain analysts expected. Distillate fuel inventories fell 2.2 million bbl to 118.7 million bbl, outstripping an anticipated 1.5 million bbl drop.

The American Petroleum Institute earlier reported a 3.7 million bbl jump in US crude stocks to 369.3 million bbl last week, with gasoline inventories down 1.2 million bbl to 199.2 million bbl and distillate fuel stocks up 1.8 million bbl to 122.6 million bbl.

EIA said crude imports into the US increased 126,000 b/d to 8.3 million b/d last week. In the 4 weeks through Oct. 12, US crude imports averaged 8.1 million b/d, down 785,000 b/d from the comparable period in 2011. Gasoline imports last week averaged 530,000 b/d while distillate fuel imports averaged 85,000 b/d.

The input of crude into US refineries was up 70,000 b/d to 14.8 million b/d last week with units operating at 87.4% capacity, EIA reported. Gasoline production increased to 9 million b/d, and distillate fuel production increased to 4.5 million b/d.

Energy prices

The November contract for benchmark US light, sweet crudes increased 24¢ to $92.09/bbl Oct. 16 on the New York Mercantile Exchange. The December contract advanced 22¢ to $92.54/bbl. On the US spot market, WTI at Cushing, Okla., was up 24¢ to $92.09/bbl.

Heating oil for November delivery continued slipping, down 1.06¢ to $3.20/gal on NYMEX. Reformulated stock for oxygenate blending for the same month dipped 0.5¢ but closed essentially unchanged at a rounded $2.85/gal.

The November natural gas contract continued to decline, down 4.9¢ to $3.44/MMbtu on NYMEX. On the US spot market, gas at Henry Hub, La., dropped 8.1¢ to $3.26/MMbtu.

In London, the November IPE contract for North Sea Brent fell 73¢ to $115.07/bbl. Gas oil for November rebound by $5.50 to $1,003.25/tonne.

The average price for the Organization of Petroleum Exporting Countries’ basket of 12 benchmark crudes regained 39¢ to $111.09/bbl.

Contact Sam Fletcher at samf@ogjonline.com.

Related Articles

PHMSA proposes pipeline accident notification regulations

07/02/2015 The US Pipeline and Hazardous Materials Safety Administration has proposed new federal oil and gas pipeline accident and notification regulations. ...

FourPoint Energy to acquire Anadarko basin assets from Chesapeake

07/02/2015 FourPoint Energy LLC, a privately owned Denver company, plans to acquire oil and gas assets from Chesapeake Energy Corp. subsidiaries Chesapeake Ex...

Puma Energy completes purchase of Murco’s UK refinery, terminals

07/02/2015 Singapore-based Puma Energy Group Pte. has completed its purchase of UK midstream and downstream assets from Murco Petroleum Ltd., a subsidiary of ...

BP to settle federal, state Deepwater Horizon claims for $18.7 billion

07/02/2015 BP Exploration & Production Inc. has agreed in principle to settle all federal and state claims arising from the 2010 Deepwater Horizon inciden...

MARKET WATCH: NYMEX oil prices plummet on crude inventory build, Iran deadline extension

07/02/2015 Oil prices plummeted more than $2/bbl July 1 to settle at a 2-month low on the New York market after a weekly government report showed the first ri...

API to issue recommended practice to address pipeline safety

07/01/2015 The American Petroleum Institute expects to issue a new recommended practice in another few weeks that addresses pipeline safety issues, but the tr...

Shell Midstream Partners takes interest in Poseidon oil pipeline

07/01/2015 Shell Midstream Partners LP has completed its acquisition of 36% equity interest in Poseidon Oil Pipeline Co. LLC from Equilon Enterprises LLC, a s...

MARKET WATCH: Oil prices decline as US crude inventories post first gain in 9 weeks

07/01/2015 Oil prices on July 1 surrendered much of their gains from the day before after the release of a government report showing the first rise in US crud...

FWS issues Shell letter of authorization on Chukchi Sea lease

07/01/2015 The US Fish & Wildlife Service issued Shell Gulf of Mexico Inc. a letter of authorization (LOA) related to the potential disturbance of polar b...
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


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