MARKET WATCH: NYMEX crude oil climbs above $100/bbl on heating demand

Crude oil futures prices on the New York market reached above $100/bbl on Feb. 11, settling at a high for the year, which analysts attributed to anticipated weekly reports showing sharp drops in US oil and product inventories because of high heating demand this winter.

Light, sweet crude for March delivery on the New York Mercantile Exchange reached as high as $100.55/bbl during Feb. 11 trading, marking the highest since Dec. 27, 2013, before retreating to close at $100.06/bbl, up 18¢ from the Feb. 7 settlement. The April contract climbed 9¢ to settle at $99.44/bbl.

Ole Hansen, head of commodity trading with Saxo Bank in Denmark, said the NYMEX crude futures rally was “driven by increased demand for distillate products during the coldest January in living memory,” and has triggered what he calls “a reduction in volatility over the past week.”

He sees reduced volatility based “on the assumption that further upside risks seem limited from here as refinery demand is expected to drop as we enter the annual turnaround season.”

PIRA Energy Group of New York anticipates another US oil and products stock decline when the US Energy Information Administration releases its weekly inventory report on Feb. 12.

“January has been remarkable with US oil inventories falling…some 22 million bbl. This past week contributed 5.3 million bbl of the decline, all of which was in products since crude oil inventories built slightly,” PIRA said in a research note.

Fitch Ratings in Chicago issued a report say its credit rating analysts believe the growth of US oil production will continue to moderate world oil prices. The EIA estimates US oil production increasing through 2019, possibly to 9.6 million b/d.

Rising US production already has offset ongoing supply disruptions in the Middle East, and raised expectations of higher future supply, Fitch said.

Although unconventional development benefits primarily US producers and consumers, Fitch analysts said all oil-consuming countries benefit from the stabilizing effect of world oil prices resulting from increased US oil output.

Energy prices

NYMEX heating oil for March delivery declined 5.22¢ to a rounded $3/gal. Reformulated gasoline stock for oxygenate blending for March delivery fell 2.41¢ to a rounded $2.72/gal.

The March natural gas contract on NYMEX declined 19.6¢ to a rounded $4.58/MMbtu. On the US spot market, the gas price at Henry Hub, La. was a rounded $7.58/MMbtu, rising $1.40.

In London, the March ICE contract for Brent crude delivery decreased 94¢, closing at $108.63/bbl, marking its biggest single-day drop since Jan. 31. The April ICE contract for Brent was down 89¢ to $107.96/bbl.

The ICE gas oil contract for February gained $2 to $921/tonne.

The Organizational of Petroleum Exporting Countries reported its basket of 12 benchmark crudes was $105.52/bbl on Feb. 10, climbing $1.11.

Contact Paula Dittrick at paulad@ogjonline.com

Related Articles

Market watch: Energy futures prices rose slightly Friday

05/06/2002 Crude oil futures prices rose slightly Friday amid lingering uncertainty about a possible disruption of Middle East supplies, although tensions in ...

Gulf of Mexico oil service sector showing signs of an upturn

05/06/2002 The Gulf of Mexico oil service sector is experiencing the signs of an upturn, analysts with Simmons & Co. International, UBS Warburg LLC, and RBC D...

OTC: Industry, national agencies need to work together to make FPSOs work in the gulf

05/06/2002 Over the coming years, the oil and gas industry will have to keep an open line of communication with national agencies such as the US Coast Guard a...

Market watch: Energy futures prices fall as Iraq lifts embargo

05/07/2002 Crude oil futures prices fell Monday after Iraq announced plans to lift a self-imposed export embargo with exports expected to resume by Wednesday.

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