MARKET WATCH: Crude soars on talk of military strike against Syria

Crude oil futures prices reached their highest level since February 2012 on the New York market Aug. 28 while Brent futures prices reached a 6-month high amid worries that a potential military strike against Syria could interrupt the flow of world oil supplies.

US Sec. of State John Kerry sharply criticized the Syrian government’s alleged use of chemical weapons against Syrian rebels in a civil war. European leaders also spoke out against the use of chemical weapons earlier this week.

Analysts say such talk might result in foreign intervention in Syria, which lies near major crude oil sea routes and pipelines. The US Energy Information Administration estimates 4.5 million b/d is transported through Egypt via the Suez Canal and the Suez-Mediterranean pipeline.

Meanwhile, some other oil supplies are coming back on the market. The Libyan oil terminal at Marsa al Brega has reopened after protesters had disrupted exports from that port.

Oil inventories climb

Weekend inventory reports showed crude stockpiles rising after having fallen for 7 of the last 8 weeks. The American Petroleum Institute reported Aug. 27 that oil inventories increased 2.5 million bbl for the week ended Aug. 23.

In its weekly oil inventory report released Aug. 28, EIA said US commercial crude oil inventories, excluding the Strategic Petroleum Reserve, increased by 3 million bbl to 362 million bbl, which is near the upper limit of the average range for this time of year.

Crude import averaged 8.4 million b/d, up by 423,000 b/d. Over the last 4 weeks, crude oil imports averaged over 8 million b/d, some 723,000 b/d below the same 4-week period last year.

Total motor gasoline inventories decreased by 600,000 bbl, remaining in the upper half of the average range. Finished gasoline inventories increased while blending components inventories decreased, EIA said.

Distillate fuel inventories decreased 300,000 bbl, nearing the lower limit of the average range for this time of year. Propane-propylene inventories increased by 200,000 bbl last week and are in the middle of the average range.

US crude refinery inputs averaged about 15.8 million b/d during the week ended Aug. 23, which was 71,000 b/d less than the previous week’s average. Refineries operated at 91.3% of capacity last week. Gasoline production decreased, averaging 9.4 million b/d. Distillate fuel production also decreased, averaging 4.9 million b/d.

Energy prices

The October contract for benchmark US light, sweet crudes on the New York Mercantile Exchange rose $3.09, closing at $109.01/bbl on Aug. 27. The November contract climbed $2.95 to $108.30/bbl.

Heating oil for October delivery increased 8.2¢ to settle at $3.16/gal on NYMEX. Reformulated gasoline stock for oxygenate blending for September rose 8.2¢ to $3.03/gal.

The September natural gas contract was up by 2.1¢ to close at $3.53/MMbtu on NYMEX. On the US spot market, gas prices at Henry Hub, La., declined by 4.3¢, settling at a rounded $3.51/MMbtu.

In London, the October IPE contract for North Sea Brent crude climbed $3.63 to $114.36/bbl. The September contract for gas oil settled at $961.75/tonne, up $21.50 from the previous session.

The Organization of Petroleum Exporting Countries reported its basket of 12 benchmark crudes was up 92¢, closing at $109.01/bbl on Aug. 27.

Contact Paula Dittrick at paulad@ogjonline.com.

Related Articles

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...

USGS: Water usage for fracturing varies widely across shale plays

07/01/2015 The volume of water required to hydraulically fracture wells varies widely across the country, according to the first national analysis and map of ...

Case for Keystone XL has grown stronger, TransCanada tells Kerry

06/30/2015 Canada is taking strong steps toward combating climate change, and the proposed Keystone XL pipeline crude oil pipeline remains in the US national ...

Forum extends study of subsea integrity

06/30/2015

Work by an industry forum called SURF IM Network, which studies oil and gas subsea integrity management, has been extended by 3 years.

Survey begins of collaboration on the UKCS

06/30/2015

Deloitte has begun a survey about collaboration in the oil and gas producing industry of the UK Continental Shelf.

Lytle named to Canada’s National Energy Board

06/30/2015

Murray Lytle has been appointed as a full-time member of Canada’s National Energy Board for a term of 7 years, effective July 6.

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