MARKET WATCH: NYMEX oil prices jump pending Fed decision, inventory report

Crude oil futures prices jumped on New York and London markets in Jan. 28 trading, and analysts said the US market fluctuated awaiting a decision from Federal Reserve officials regarding whether they would accelerate the tapering of an economic stimulus program.

The US Energy Information Administration said commercial crude oil inventories, excluding those in the Strategic Petroleum Reserve, increased by 6.4 million bbl for the week ended Jan. 24 compared with the week ended Jan. 17.

The latest EIA report, released Jan. 29, estimated US crude oil inventories at 357.6 million bbl, which is in the upper half of the average range for this time of year. Separately, the American Petroleum Institute said its estimate showed crude oil inventories rose by 4.7 million bbl for the week ended Jan. 24.

The futures price spread between US light, sweet crude oil and Brent for March delivery narrowed to $10 on Jan. 28. Brent prices have been higher for months, and $10 marked the narrowest gap in settlement prices since mid-November 2013.

Iraqi oil Minister Abdul Kareem Luaiby told reporters on Jan. 28 that Iraq is negotiating for sharp cuts in production targets with major Western oil companies regarding some of Iraq’s largest oil fields.

Hussain al-Shahristani, Iraq’s deputy prime minister for energy, told reporters Iraq is drafting proposals regarding a possible return of the production quota system for the Organization of Petroleum Exporting Countries.

Speaking at a conference hosted by Chatham House in London, OPEC’s secretary general said OPEC will be able to handle anticipated oil volumes from Iran, Iraq, and Libya.

“We will accommodate them, and OPEC will be as before,” Abdullah al-Badri told reporters in London, saying OPEC members can prevent oversupply issues. “We’ve faced a lot of difficulties in the past, and we were able to overcome them, and this we will overcome.”

Regarding US oil prices, analysts and traders awaited a statement from the Jan. 29 conclusion of the Fed’s policy meeting. The Fed’s Open Market Committee evaluated the pace of tapering an economic stimulus program. Previously, the Fed reduced its bond-buying program to $75 billion/month from $85 billion/month.

Another reduction would strengthen the US dollar, which analysts say would pressure oil prices by making it more expensive for oil buyers using other currencies to buy oil denominated in dollars.

Distillate stocks drop

As anticipated given winter storms, EIA said US distillate fuel inventories decreased by 4.6 million bbl last week and are well below the lower limit of the average range for this time of year. Propane-propylene inventories fell 3.6 million bbl last week and are well below the lower limit of the average range.

Total motor gasoline inventories decreased by 800,000 bbl, but are well above the upper limit of the average range. Finished gasoline inventories increased while blending components inventories decreased, EIA said.

US refinery inputs averaged over 15.4 million b/d for the week ended Jan. 24, which was an increase of 201,000 b/d from the previous week’s average. Refineries operated at 88.2% of capacity last week. Gasoline production increased last week, averaging 9.2 million b/d. Distillate fuel production increased last week, averaging over 4.8 million b/d.

Crude oil imports averaged over 8 million b/d last week, up by 504,000 b/d from the previous week. Over the last 4 weeks, crude oil imports averaged over 7.6 million b/d, which was 5.4% below the same period last year.

Total motor gasoline imports, including both finished gasoline and gasoline blending components, last week averaged 466,000 b/d, EIA said. Distillate fuel imports averaged 317,000 b/d last week.

Energy prices

The New York Mercantile Exchange March crude contract gained $1.69 on Jan. 28, closing at $97.41/bbl. The April contract climbed $1.60 to settle at $96.96/bbl.

Heating oil for February delivery rose 2.94¢ to a rounded $3.12/gal. Reformulated gasoline stock for oxygenate blending for February delivery edged up 0.61¢ to a rounded $2.63/gal.

The February natural gas contract on NYMEX rose 18.6¢ to a rounded $5.03/MMbtu. On the US spot market, the gas price at Henry Hub declined by 51¢ to $5.24/MMbtu.

In London, the March ICE contract for Brent crude delivery gained 72¢, closing at $107.41/bbl as the April contract jumped by 83¢ to $106.86/bbl. The ICE gas oil contract for February was up $3 to $917.50/tonne.

The Organizational of Petroleum Exporting Countries reported its basket of 12 benchmark crudes climbed by 5¢ to $104.67/bbl.

Contact Paula Dittrick at paulad@ogjonline.com.

Related Articles

Inhofe, Lankford say new BIA rules threaten Osage oil operations

07/10/2015 New US Bureau of Indian Affairs regulations that increase production expenses on tribal lands could put the Osage Nation out of business, Oklahoma’...

House panel’s crude export ban hearing weighs urgency against caution

07/10/2015 A US House Energy and Commerce subcommittee hearing on legislation to repeal the ban on exporting US-produced crude oil quickly broke along party l...

Chevron Phillips Chemical makes executive appointments

07/10/2015

Chevron Phillips Chemical Co. LLC has made several executive appointments, all effective Aug. 1.

Twelve workers killed in Nigeria pipeline explosion

07/10/2015 Eni SPA reported that an explosion occurred July 9 at the repair site for the Tebidaba-Clough Creek oil pipeline in Nigeria’s onshore Niger Delta.

Gov. Tomblin forms West Virginia oil, gas safety commission

07/10/2015 West Virginia Gov. Earl Ray Tomblin (D) established the oil and gas safety commission he announced in his 2015 State of the State address. The grou...

MARKET WATCH: NYMEX, Brent crude oil prices rebound more than $1/bbl

07/10/2015 Prices for US light, sweet crude oil and Brent crude each rebounded by more than $1/bbl on their respective markets July 9, and analysts attributed...

Transco seeks FERC approval for New York Bay Expansion project

07/09/2015 Transcontinental Gas Pipe Line Co. LLC (Transco), a wholly owned subsidiary of Williams Partners LP, has filed an application with the US Federal E...

House Oversight panel subpoenas Kerry for Keystone XL documents

07/09/2015 The US House Oversight and Government Reform Committee issued a subpoena to US Sec. of State John F. Kerry for reports, recommendations, letters, a...

MARKET WATCH: NYMEX crude oil prices drop for fifth consecutive trading session

07/09/2015 US light, sweet crude oil prices settled slightly lower on the New York market July 8 for the fifth consecutive trading session, and analysts attri...
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