Light, sweet crude oil prices rose by more than $1 on the New York Mercantile Exchange to settle above $65/bbl, maintaining an early 2018 trend for the highest oil prices since 2014. US oil inventories fell last week, surprising some market participants who had anticipated an increase.
The US Energy Information Administration estimated crude supplies, excluding the Strategic Petroleum Reserve, fell 1.1 million bbl for the week ended Jan. 19—marking 10 consecutive weeks of decline.
The Weekly Petroleum Status Report said the latest total was 411.6 million bbl, putting supplies in the middle of the average range for this time of year (OGJ Online, Jan. 24, 2018). Separately, the American Petroleum Institute had estimated a rise of 4.8 million bbl.
Support for US oil futures also came after US Treasury Sec. Steven Mnuchin said “a weaker dollar is good for trade,” during the World Economic Forum in Davos, Switzerland. The US dollar declined in value to other currencies after his statement, analysts said.
Oil is traded on world markets in US dollars, so a weakening dollar makes oil less expensive for buyers starting with other currencies.
The EIA said US oil production averaged 9.878 million b/d for the week ended Jan. 19, up 128,000 b/d from the previous week. The Lower 48 accounted for 9.372 million b/d last week, up 126,000 b/d while Alaska’s production was 506,000 b/d, up 2,000 b/d.
Energy prices
The March light, sweet crude contract on the New York Mercantile Exchange gained $1.14 on Jan. 24 to settle at $65.61/bbl. The April contract increased $1.05 to $65.36/bbl.
The NYMEX natural gas price for February added 65¢ to a rounded $3.51/MMbtu. The Henry Hub cash gas price climbed 20¢ to $3.56/MMbtu.
Ultralow-sulfur diesel for February was up 2¢ to a rounded $2.11/gal. The NYMEX reformulated gasoline blendstock for February edged up less than 1¢ to a rounded $1.92/gal.
Brent on London’s ICE for March climbed 57¢ to $70.53/bbl. The April contract was up 48¢ to $70.02/bbl. The gas oil contract for February reached $620.50/tonne, up $2.75.
The Organization of Petroleum Exporting Countries’ basket of crudes was $67.61/bbl on Jan. 24, up 29¢.
Contact Paula Dittrick at [email protected].
