Oil prices rose slightly Apr. 19, but the front-month crude contract was down 4% for the week on weak economic data out of China. Natural gas, however, gained 4% overall last week on a bullish storage report by the Energy Information Administration.
“Oil markets couldn’t muster any significant upward momentum [on Apr. 19], with both benchmarks putting in a lackluster performance,” said Marc Ground at Standard New York Securities Inc., the Standard Bank Group. “Both are now facing key technical resistance levels, $90/bbl and $100/bbl for West Texas Intermediate and Brent, respectively.”
In Houston, analysts with Raymond James & Associates Inc. reported, “Over the past couple of weeks, the potential slowing of the Chinese economy has once again taken center stage in the global commodity markets. Signs of cracks in the Chinese economic engine have helped drive a sell-off in virtually all major commodity markets. With its new leadership at China's helm and increased stimulus, we (and many others) thought Chinese oil demand growth would be higher in 2013 than 2012. Unfortunately for oil prices, that Chinese oil demand growth may now be lower than most originally thought. When you combine a slowing Chinese demand growth rate with the austerity consequences of global balance sheet de-levering, you end up with sub-par global oil demand growth.”
In other news, the National Association of Realtors said sales of used houses in the US dipped in March to a seasonally adjusted annual rate of 4.92 million from a revised 4.95 million in February due to tight supply. However, the pace of March sales was 10.3% higher than a year earlier. The number of homes for sale increased 1.6% to 1.93 million, still 16.8% lower than the housing supply a year ago. The Realtors' group expects an increased number of houses to come on the market as increased employment and near record-low mortgage rates boost demand for houses.
The May contract for benchmark US light, sweet crudes increased 28¢ to $88.01/bbl Apr. 19 on the New York Mercantile Exchange. The June contract rose 27¢ to $88.27/bbl. On the US spot market, WTI at Cushing, Okla., was up 28¢ to $88.01/bbl.
Heating oil for May delivery inched up 0.85¢ to $2.79/gal on NYMEX. Reformulated stock for oxygenate blending for the same month advanced 1.69¢ to $2.77/gal.
The May natural gas contract was up 0.7¢ to $4.41/MMbtu on NYMEX. On the US spot market, gas at Henry Hub, La., escalated 12.9¢ to $4.37/MMbtu.
In London, the June IPE contract for North Sea Brent crested slightly above $100 before closing at $99.65/bbl, up 52¢ for the day. Gas oil for May climbed $4.25 to $832.50/tonne.
The average price for the Organization of Petroleum Exporting Countries’ basket of 12 benchmark crudes increased $1.05 to $97.40/bbl. So far this year, OPEC’s basket price has averaged $107.98/bbl.
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