MARKET WATCH: Early rally in NY crude prices fades to a loss

Crude prices climbed in early trading Jan. 8 but closed with small losses in mixed markets.

The early rally in crude “was stymied by the combination of a stronger dollar and concerns about growing US crude and product inventories,” said Marc Ground at Standard New York Securities Inc., the Standard Bank Group. “Brent, however, managed to hold onto most of its earlier gains (buoyed by index rebalancing).”

In Houston, analysts with Raymond James & Associates Inc. reported, “After the mega-rally last week, [equity] stocks fell for the second straight day as exuberance fades away and caution lingers ahead of earnings season. The Standard & Poor’s 500 Index was down 0.3% on the session, compounded by a declining dollar and weaker-than-expected trade data out of Germany, up to now one of the few bright spots in the Euro-zone.” The front-month natural gas contract dropped 1.5% with mild weather across the US.

Ground noted markets were “edgy but noncommittal, as evidence by the heightened volatility in a fairly tight trading range” Jan. 9 prior to US Energy Information Administration’s weekly oil inventory report. He said, “While a build in gasoline stocks is expected in the first quarter, current levels are already unusually high, well above the 5-year range.”

US inventories

EIA reported commercial US crude inventories increased 1.3 million bbl to 361.3 million bbl in the week ended Jan. 4, less than Wall Street’s consensus for a 2 million bbl gain. However, gasoline stocks jumped 7.4 million bbl to 233.1 million bbl during the same period, far exceeding the expected 2.5 million bbl gain. Finished gasoline inventories decreased while blending components increased. Distillate fuel stocks escalated 6.8 million bbl to 130.7 million bbl, far above the 1.9 million bbl increase the market anticipated.

The American Petroleum Institute earlier reported US crude stocks were up 2.4 million bbl to 360.8 million bbl, while gasoline inventories shot up 7.9 million bbl to 227.1 million bbl. API reported distillate stocks climbed 5.9 million bbl to 131.4 million bbl.

The import of crude into the US surged by 1.2 million b/d to 8.3 million b/d last week, EIA officials said. In the 4 weeks through Jan. 4 US crude imports averaged 8 million b/d, down 911,000 b/d from the comparable period in 2012. Gasoline imports last week averaged 447,000 b/d while distillate fuel imports averaged 197,000 b/d.

The input of crude into US refineries increased 84,000 b/d to 15.3 million b/d last week with units operating at 89.1% of capacity, EIA reported. Gasoline production decreased to 8.4 million b/d, but distillate fuel production increased to 4.9 million b/d.

Energy prices

The February contract for benchmark US light, sweet crudes climbed as high as $93.80/bbl in intraday trading Jan. 8 but closed at $93.15/bbl, down 4¢ for the day on the New York Mercantile Exchange. The March contract dipped 3¢ to $93.60/bbl. However, the April contract was unchanged, and those for subsequent months registered modest gains progressively through February 2014. On the US spot market, West Texas Intermediate at Cushing, Okla., followed the front-month futures contract down 4¢ to $93.15/bbl.

Heating oil for February delivery gained 2.64¢ to $3.06/gal on NYMEX. Reformulated stock for oxygenate blending for the same month increased 1.7¢ to $2.79/gal.

The February natural gas contract continued its decline, down 4.8¢ to $3.22/MMbtu on NYMEX. On the US spot market, gas at Henry Hub, La., fell 9.7¢ to $3.21/MMbtu.

In London, the February IPE contract for North Sea Brent increased 54¢ to $111.94/bbl. Gas oil for January gained $6.75 to $945.25/tonne.

The average price for the Organization of Petroleum Exporting Countries’ basket of 12 benchmark crudes rebound by 57¢ to $108.72/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