MARKET WATCH: Crude down 3% last week in NY futures market

Oil prices continued falling Mar. 1 with crude down 3% for the week in the New York market, erasing all previous gains in 2013. Natural gas price was down for the day but up 4% last week on an Energy Information Administration report of a sharp drop in US gas production in December.

“As expected, with the automatic spending cuts [under US Congressional sequestration rules] finally kicking in [at midnight Mar. 1] and weaker economic data coming out of China, broader market futures are down this morning,” said analysts in the Houston office of Raymond James & Associates Inc. In early trading Mar. 4, gas was in the red while crude prices were marginally higher.

“An apparently more hawkish Federal Open Market Committee [the policy-making arm of the Federal Reserve Bank] and the seemingly more conciliatory tone taken by all parties in last week’s negotiations surrounding the Iran nuclear enrichment program kept oil markets under selling pressure,” said Marc Ground at Standard New York Securities Inc., the Standard Bank Group.

Net speculative length in benchmark crude contracts on the New York market fell for a second consecutive week. “The last time this happened was in mid-November,” Ground reported. “Disconcertingly, participants appeared to be positioning for more downside, with a 13.5 million bbl increase in speculative shorts (the largest increase since mid-December). Speculative longs fell 10 million bbl—the strongest liquidation of longs since the week ended Aug. 25.”

The potential for lower prices “is compressed but not completely absent.” Ground said, “Uncertainty surrounding the effect of the sequester on the US economy and the question marks over the extent of China’s growth going forward could keep the door to further weakness ajar.”

In other news, the US Department of State’s long-awaited supplemental environmental impact statement for the revised route of the Keystone XL pipeline's politically sensitive cross-border segment didn’t indicate any major environmental concerns (OGJ Online, Mar. 1, 2013). Instead, it acknowledged Canadian oil sands development will proceed even if the pipeline is not built. With the release of its draft SEIS, DOS has scheduled a 45-day comment period before presenting the project for presidential review. “The White House is unlikely to make a decision until the summer at the earliest, but the positive tone of the EIS will certainly raise pressure on the administration to provide approval,” Raymond James analysts said.

Energy prices

The April contract for benchmark US light, sweet crudes fell $1.37 to $90.68/bbl Mar. 1 on the New York Mercantile Exchange. The May contract dropped $1.32 to $91.14/bbl. On the US spot market, West Texas Intermediate at Cushing, Okla., was down $1.37 to $90.68/bbl in step with the front-month futures contract.

Heating oil for April delivery lost 3.02¢ to $2.93/gal on NYMEX. Reformulated stock for oxygenate blending for the same month, however, increased 1.69¢ to $3.13/gal.

The April natural gas contract declined 3¢ to $3.46/MMbtu on NYMEX. On the US spot market, gas at Henry Hub, La., inched up 0.6¢ but closed essentially unchanged at a rounded $3.54/MMbtu.

In London, the April IPE contract for North Sea Brent lost 98¢ to $110.40/bbl. Gas oil for March fell $17.75 to $920.50/tonne.

The average price for the Organization of Petroleum Exporting Countries’ basket of 12 benchmark crudes continued to retreat, down $1.83 to $106.79/bbl. So far this year, the OPEC basket price has averaged $110.84/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

On Demand

OGJ's Midyear Forecast 2015

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

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


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