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

Shell cuts $15 billion in spending for 2015-17

01/30/2015 Royal Dutch Shell PLC has curtailed more than $15 billion in potential spending over the next 3 years, but is not “not overreacting to current low ...

Victoria extends drilling, fracing ban

01/30/2015 The new Victorian Labor government of premier Daniel Andrews has extended the coal seam gas (CSG) exploration and hydraulic fracturing ban in the s...

Chevron’s $35 billion capital budget down 13% from last year

01/30/2015 Chevron Corp. will allocate $35 billion in its capital and exploratory investment program for 2015, including $4 billion of planned expenditures by...

US Senate passes bill approving Keystone XL pipeline project

01/30/2015 The US Senate has passed a bill approving construction of the proposed Keystone XL crude oil pipeline by a 62-36 vote after 3 weeks of debate. Nine...

Oxy cuts capital budget by a third

01/30/2015 In the midst of falling oil prices, Occidental Petroleum Corp., Houston, expects to reduce its total capital spending for 2015 to $5.8 billion from...

MARKET WATCH: NYMEX natural gas prices drop after storage report

01/30/2015 US natural gas closed at its lowest price in more than 2 years on the New York market Jan. 29 following the government’s weekly gas storage report,...

Pennsylvania governor reinstates state forest drilling moratorium

01/29/2015 Pennsylvania Gov. Tom Wolf (D) signed an executive order fully reinstating a 2010 moratorium on new oil and gas leases in state forests and parks. ...

PwC: Low oil prices might drive surge in restructuring in 2015

01/29/2015 Mergers and acquisitions (M&A) in the oil and gas industry hit 10-year highs in terms of deal value and volume in 2014, according to a report f...

DOE could meet 45-day LNG export decision deadline, Senate panel told

01/29/2015 The US Department of Energy would have no trouble meeting a 45-day deadline to reach a national interest determination for proposed LNG export faci...
White Papers

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

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
Available Webcasts


OGJ's Midyear Forecast 2015

When 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

When 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



On Demand

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


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