The light, sweet crude oil contract for December declined slightly on the New York market to about $45.50/bbl Nov. 17, which analysts attributed to pressure from a strengthening US dollar and also to lingering uncertainty about future production by the Organization of Petroleum Exporting Countries.
US Federal Reserve Chairwoman Janet Yellen said the Fed might raise interest rates “relatively soon” if the economy continues to improve. Many observers took that to mean December. Oil is traded in dollars so a stronger dollar makes oil more expensive for buyers using other currencies.
The Wall Street Journal Dollar Index was up 0.3% Nov. 18 against a basket of currencies. The index has risen for 9 consecutive trading sessions. The longest sustained advancement since 2009.
Brent crude oil prices also fell slightly on the London market Nov. 17 while market participants closely monitored any comments coming from the sidelines of a natural gas forum in Doha. A Nov. 30 OPEC meeting is scheduled in Vienna.
Some OPEC members talked informally on the Doha meeting’s sidelines about how the cartel might cut oil production quotas to keep production at 32.5-33 million b/d.
OPEC production averaged 33.83 million b/d in October. Saudi Energy Minister Khalid al-Falih told Saudi-owned Al Arabiya television Nov. 17 that he is “optimistic” that OPEC’s members will formalize the tentative deal they reached in September and set production limits for individual countries.
Energy prices
The December crude oil contract on the New York Mercantile Exchange dropped 15¢ on Nov. 17 to close at $45.42/bbl. The January contract declined 12¢ to $45.98/bbl.
The natural gas contract for December dropped 6¢ to a rounded $2.70/MMbtu. On the spot market, the Henry Hub gas price was down 20¢ to $2.33/MMbtu.
Heating oil for December climbed 1.2¢ to a rounded $1.45/gal. The price for reformulated gasoline stock for oxygenates blending for December rose 2.4¢ to a rounded $1.34/gal.
The January Brent crude contract on London’s ICE was down 14¢ to settle at $46.49/bbl. The Brent contract for February decreased 2¢ to $47.60. The December gas oil contract increased $1.25 to $423.50/tonne.
The average price for OPEC’s basket of benchmark crudes on Nov. 18 was $42.90, up 7¢.
Contact Paula Dittrick at [email protected].