Light, sweet crude oil prices for April delivery dropped modestly on Mar. 20, holding above $48/bbl on the New York market in what one analyst calls a possible trend toward a new, lower range of oil prices than the $50-54/bbl range that had existed earlier this year.
“Crude oil is showing the first signs of potentially settling into a new, lower range than that witnessed from December to February,” said Ole Hansen, Saxo Bank head of commodity strategy.
He said Libyan oil production is likely to rise again while US crude oil inventories are expected to have increased for the week ended Mar. 17. The US Energy Information Administration will release its weekly inventory report on Mar. 22.
Meanwhile, the Organization of Petroleum Exporting Countries and other major producers are monitoring progress in making negotiated production cuts to support oil prices. Those producers agreed last year to 6-month production targets, which started in January.
Energy prices
The crude oil contract for April delivery on the New York Mercantile Exchange dropped 56¢ on Mar. 20 to $48.22/bbl. The May contract fell by 40¢ to $48.91/bbl.
The natural gas price for April rose 9¢ to a rounded $3.04/MMbtu. The Henry Hub cash gas price closed at $2.92/MMbtu, up 10¢.
Heating oil for April rose by less than 1¢ to a rounded $1.51/gal. Reformulated gasoline stock for oxygenate blending for April also gained nearly a penny to a rounded $1.61/gal.
The Brent crude contract for May on London’s ICE decreased 14¢ to $51.62/bbl. The June contract dropped 16¢ to $51.79/bbl. The gas oil contract settled at $458.50/tonne on Mar. 20, up $1.75.
The average price for OPEC’s basket of benchmark crudes on Mar. 20 was $49.18/bbl, down 18¢.
Contact Paula Dittrick at [email protected].
