Oil markets continued to waffle with crude posting a marginal daily loss Jan. 25 but finishing up modestly overall for its seventh consecutive week. Natural gas prices continued to slip, however, down 3% for the week in the New York market despite colder weather in the US Northeast.
“However, there does appear to be a slowing of upward momentum in the US benchmark price,” said Marc Ground at Standard New York Securities Inc., the Standard Bank Group. Growing optimism over the US and Chinese economy has extended participants’ interest in West Texas Intermediate “beyond the enthusiasm that first followed the resumption of service in the Seaway Pipeline,” he said.
In the equity market major indices rose for the fourth straight week “as earnings generally topped Street expectations and fears over fiscal gridlock in Washington subsided. Energy stocks followed the broader markets,” said analysts in the Houston office of Raymond James & Associates Inc.
Meanwhile, Raymond James analysts foresee a turbulent NGL market with prices averaging 74¢/gal in 2013 and 85¢/gal in 2014. “Producers have been taking advantage of the value uplift from NGLs; however, now with ethane and propane prices ‘pinned to the mat’ and our bearish crude price outlook, NGL prices could remain lower for longer,” they said.
The March contract for benchmark US light, sweet crudes slipped 7¢ to $95.88/bbl Jan. 25 on the New York Mercantile Exchange. The April contract declined 12¢ to $96.33/bbl. On the US spot market, WTI at Cushing, Okla., was down 7¢ to $95.88/bbl.
Heating oil for February delivery retreated 2.96¢ to $3.06/gal on NYMEX. Reformulated stock for oxygenate blending for the same month, however, increased 1.25¢ to $2.88/gal.
The February natural gas contract dipped 0.2¢ to $3.44/MMbtu on NYMEX. On the US spot market, gas at Henry Hub, La., fell 14.7¢ to $3.41/MMbtu.
In London, the March IPE contract for North Sea Brent was unchanged at $113.28/bbl in the Jan. 25 session but posted a weekly gain of $1.39/bbl. Gas oil for February dropped $7.50 to $968.50/tonne.
The average price for the Organization of Petroleum Exporting Countries’ basket of 12 benchmark crudes increased 32¢ to $110.20/bbl. So far this year, OPEC’s basket price has averaged $108.88/bbl.
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