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

Statoil reduces capital budget by $2 billion following 4Q losses

02/06/2015 Statoil ASA has reduced its organic capital expenditure to $18 billion in 2015 from $20 billion in 2014. The move comes on the heels of a fourth qu...

Chinese regulators approve Sinopec’s plan for grassroots refinery

02/06/2015 China’s National Development and Reform Commission (NDRC) has approved Sinopec Beijing Yanshan Petrochemical Co. Ltd., a subsidiary of China Nation...

BOEM schedules public meetings about draft proposed 5-year OCS plan

02/06/2015 The US Bureau of Ocean Energy Management will hold the first of 20 public meetings in Washington on Feb. 9 to receive public comments on potential ...

Union strike ongoing at US refineries as negotiations continue

02/06/2015 A strike by union workers at nine US refining and petrochemical production plants remains under way as the United Steelworkers Union (USW) continue...

NCOC lets $1.8-billion pipeline contract for Kashagan field

02/06/2015 North Caspian Operating Co. (NCOC) has let a $1.8-billion engineering and construction contract to ERSAI Caspian Contractor LLC, a subsidiary of Sa...

AOPL releases 2015 safety performance and strategic planning report

02/06/2015 The Association of Oil Pipe Lines is committed to further improvements despite a 99.99% safe petroleum liquids delivery rate, AOPL Pres. and Chief ...

MARKET WATCH: NYMEX oil price bounces back up somewhat

02/06/2015 Crude oil prices on the New York market bounced up $2/bbl to settle slightly above $50/bbl Feb. 5. The positive momentum continued during early Jan...

Congressional Republicans renew bid to halt sue-and-settle maneuvers

02/05/2015 Calling it an affront to regulatory accountability that results in unchecked compliance burdens, US Sen. Charles E. Grassley (R-Iowa) and US Rep. D...

Oil-price collapse may aggravate producing nations’ other problems

02/05/2015 The recent global crude-oil price plunge could be aggravating underlying problems in Mexico, Colombia, and other Western Hemisphere producing natio...

White Papers

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

The impact of aging infrastructure in process manufacturing industries

Process manufacturing companies in the oil and gas, utilities, chemicals and natural resource industri...
Sponsored by

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

Available Webcasts



Global LNG: Adjusting to New Realties

When Fri, Mar 20, 2015

Oil & Gas Journal’s March 20, 2015, webcast will look at how global LNG trade will be affected over the next 12-24 months by falling crude oil prices and changing patterns and pressures of demand. Will US LNG production play a role in balancing markets? Or will it add to a growing global oversupply of LNG for markets remote from easier natural gas supply? Will new buyers with marginal credit, smaller requirements, or great need for flexibility begin to look attractive to suppliers? How will high-cost, mega-projects in Australia respond to new construction cost trends?

register:WEBCAST


US Midstream at a Crossroads

When Fri, Mar 6, 2015

Oil & Gas Journal’s Mar. 6, 2015, webcast will focus on US midstream companies at an inflection point in their development in response to more than 6 years shale oil and gas production growth. Major infrastructure—gas plants, gathering systems, and takeaway pipelines—have been built. Major fractionation hubs have expanded. Given the radically changed pricing environment since mid-2014, where do processors go from here? What is the fate of large projects caught in mid-development? How to producers and processors cooperate to ensure a sustainable and profitable future? This event will serve to set the discussion table for the annual GPA Convention in San Antonio, Apr. 13-16, 2015.

This event is sponsored by Leidos Engineering.

register:WEBCAST



On Demand

The Future of US Refining

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

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


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