By the OGJ Online Staff
HOUSTON, Jan. 23 -- Energy futures prices rebounded in international markets Tuesday with talk that the Organization of Petroleum Exporting Countries is not only curtailing oil production as promised but might consider another reduction in March.
OPEC Sec. Gen. Alí Rodríguez Araque indicated Tuesday that member countries are in "good compliance" with new production quotas designed to reduce the group's total output by 1.5 million b/d.
In separate action, Bijan Namdar Zangeneh, Iran's petroleum minister, suggested that OPEC ministers should consider an additional reduction when they meet in March.
Market prices also were boosted when Valero Energy Corp., San Antonio, reduced January crude runs at its 12 US refineries by 265,000 b/d, or 18% of its total crude capacity. Those reductions include 55,000 b/d of run cuts resulting from planned maintenance and turnarounds as well as another 210,000 b/d of economic cuts at its Gulf Coast and East Coast refineries. Total crude capacity for the Valero refining system is more than 1.5 million b/d.
The company said additional run cuts are planned for February that would total 425,000 b/d, or 28% of its total crude capacity. Planned maintenance and turnarounds will account for 150,000 b/d of that decrease. Based on current plans, officials said, economic cuts at the Gulf Coast and East Coast refineries would account for another 275,000 b/d.
The expiring February contract for benchmark US sweet, light crudes gained 34¢ to $18.34/bbl Tuesday on the New York Mercantile Exchange. The March position also was up 32¢ to $18.98/bbl. In after-hours electronic trading, the March contract advanced to $19.10/bbl while the April contract also gained to $19.42/bbl from its closing price of $19.34/bbl.
Unleaded gasoline for February delivery gained 0.87¢ to 54.79¢/gal Tuesday on the NYMEX, while home heating oil for the same month was unchanged at 51.41¢/gal. The February natural gas position fell 13¢ to $2.11/Mcf.
The American Petroleum Institute is scheduled to release its weekly report on US petroleum inventories late today after the close of the NYMEX session. The report was delayed 1 day because of the Martin Luther King holiday Monday.
In London, North Sea Brent futures prices also climbed higher, briefly rising above the $19/bbl barrier before retreating because of a lack of buying interest on the International Petroleum Exchange.
The March Brent oil contract closed at $18.75/bbl, up 18¢ for the day after reaching as high as $19.25/bbl on the IPE. The February natural gas contract also inched up by 0.7¢ to the equivalent of $3.51/Mcf on the IPE.
The average price for OPEC's basket of seven benchmark crudes rose 26¢ to $17.70/bbl Tuesday.
