MARKET WATCH: Crude overcomes slump to post modest gain

Crude futures overcame a price slump in early trading Apr. 2 in the New York market and managed modest gains by the close of the session. The natural gas contract, however, fell 1.4% on concerns cold weather will dissipate next week.

Marc Ground at Standard New York Securities Inc., the Standard Bank Group, reported, “For most of the day, West Texas Intermediate was on the back foot,” with the front-month contract retreating a little below $96/bbl at one point. Traders feared a build-up of crude inventories at Cushing, Okla., due to the shut-down of ExxonMobil Corp.’s Pegasus Pipeline from Patoka, Ill., to Nederland, Tex., following the discovery Mar. 29 of a leak near Mayflower, Ark. (OGJ Online, Apr. 2, 2013).

However, WTI recovered its earlier losses after Shell Pipeline Co. said its 170,000 b/d Eugene Island crude pipeline system off Louisiana remained shut in as repair crews continued inspections for an apparent small leak. The pipeline has been shut in more than a week, and the company does not yet know when it will restart.

In Houston, analysts at Raymond James & Associates Inc. reported, “Investor sentiment rebound with the Standard & Poor’s 500 Index up 0.5% on the session.” Contributing to that rally, Cyprus concluded its bailout deal, and the US dollar rose against the yen.

Meanwhile, political tensions between North and South Korea continued to escalate. Stock prices fell in early trading in the equity market Apr. 3 on reports of weak hiring and growth among service companies.

US inventories

The Energy Information Administration said Apr. 3 commercial US crude inventories increased by 2.7 million bbl to 388.6 million bbl in the week ended Mar. 29, surpassing the Wall Street consensus for a gain of 2.1 million bbl. Gasoline stocks declined 600,000 bbl to 220.7 million bbl, short of the 1 million bbl draw analysts expected. Both finished gasoline and blending components were down. Distillate fuel inventories fell 2.3 million bbl to 113 million bbl, exceeding the outlook for a 1.1 million bbl drop.

Imports of crude into the US last week declined by 227,000 b/d to 7.9 million b/d. In the 4 weeks through Mar. 29, US crude imports averaged 7.7 million b/d, down 1.3 million b/d from the comparable period in 2012. Gasoline imports last week averaged 595,000 b/d, and distillate fuel imports averaged 83,000 b/d.

The input of crude into US refineries increased 130,000 b/d to 15 million b/d last week with units operating at 86.3% of capacity. Gasoline production increased to 8.9 million b/d, and distillate fuel production increased to 4.3 million b/d.

Energy prices

The May and June contracts for benchmark US light, sweet crudes were down in early trading Apr. 2 on the New York Mercantile Exchange but finished the day up 12¢ each to $97.19/bbl and $97.50/bbl, respectively. On the US spot market, WTI at Cushing increased the same amount to match the May futures contract’s closing price.

Heating oil for May delivery increased 1.87¢ to $3.09/gal on NYMEX. Reformulated stock for oxygenate blending for the same month, however, dropped 6.07¢ to $3.04/gal.

The May natural gas contract lost 4.6¢ to $3.97/MMbtu on NYMEX. On the US spot market, gas at Henry Hub, La., gained 1¢ to $4.05/MMbtu.

In London, the May IPE contract for North Sea Brent rose 67¢ to $110.69/bbl. Gas oil for April was up $14 to $929.50/tonne.

The average price for the Organization of Petroleum Exporting Countries’ basket of 12 benchmark crudes jumped by $1.19 to $108.16/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

What is System Level Thermo-Fluid Analysis?

This paper will explain some of the fundamentals of System Level Thermo-Fluid Analysis and demonstrate...

Accurate Thermo-Fluid Simulation in Real Time Environments

The crux of any task undertaken in System Level Thermo-Fluid Analysis is striking a balance between ti...

6 ways for Energy, Chemical and Oil and Gas Companies to Avert the Impending Workforce Crisis

As many as half of the skilled workers in energy, chemical and oil & gas industries are quickly he...
Sponsored by

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

Available Webcasts



The Future of US Refining

When Fri, Feb 6, 2015

Oil & Gas Journal’s Feb. 6, 2015, webcast will focus on the future of US refining as various forces this year conspire to pull the industry in different directions. Lower oil prices generally reduce feedstock costs, but they have also lowered refiners’ returns, as 2015 begins with refined products priced at lows not seen in years. If lower per-barrel crude prices dampen production of lighter crudes among shale plays, what will happen to refiners’ plans to export more barrels of lighter crudes? And as always, refiners will be affected by government regulations, particularly those that suppress demand, increase costs, or limit access to markets or supply.

register:WEBCAST


Oil & Gas Journal’s Forecast & Review/Worldwide Pipeline Construction 2015

When Fri, Jan 30, 2015

The  Forecast & Review/Worldwide Pipeline Construction 2015 Webcast will address Oil & Gas Journal’s outlooks for the oil market and pipeline construction in a year of turbulence. Based on two annual special reports, the webcast will be presented by OGJ Editor Bob Tippee and OGJ Managing Editor-Technology Chris Smith.
The Forecast & Review portion of the webcast will identify forces underlying the collapse in crude oil prices and assess prospects for changes essential to recovery—all in the context of geopolitical pressures buffeting the market.

register:WEBCAST



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


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