By the OGJ Online Staff
HOUSTON, Jan. 25 -- Oil futures prices continued to climb Thursday on the New York Mercantile Exchange with traders still trying to determine the real impact of promised production cuts by the Organization of Petroleum Exporting Countries and other nonmember producers.
Market fundamentals should become more obvious in February as additional data on petroleum inventories indicate the effect of new production quotas, analysts said. However, several traders indicated more curtailment of production might be necessary to match the decline in world demand for oil.
The March contract for benchmark US light, sweet crudes gained 20¢ to $19.70/bbl Thursday on the NYMEX, while the April position advanced 18¢ to $19.93/bbl. Both continued to gain in after-hours electronic trading to $19.79/bbl and $19.98/bbl respectively.
Home heating oil for February delivery added 0.86¢ to 53.39¢/gal. Unleaded gasoline for the same month was up 0.5¢ to 56.85¢/gal. However, the February natural gas contract dipped 2.8¢ to $2.05/Mcf.
In London, futures prices for North Sea Brent crude drifted lower to just above the $19/bbl level on the International Petroleum Exchange. The March Brent contract dropped 6¢ to $19.13/bbl through a lack of buying interest, analysts said.
They see scant support for oil prices above $19/bbl for much longer in that market. Prices are more likely to drift down, they said, with additional evidence of high inventories and overproduction.
The average price for OPEC's basket of seven crudes increased 16¢ to $18.24/bbl Thursday.
Oil futures prices were slightly firmer in overnight trading in Asian markets, up about 60¢/bbl for the week. Traders reported the oil futures market on the Singapore Exchange remained in an upswing mode, although consumption patterns show a continued weakening of Asian demand for oil.
Asian refiners are still reporting a difficult market, with some operating at 75% of their installed capacity.
Meanwhile, US gasoline production last week averaged nearly 8.2 million b/d, a record for this time of year, the American Petroleum Institute reported Thursday.
US gasoline pump prices dipped 0.5¢ to a national average of $1.105/gal including taxes during the week ended Jan. 18, API officials said. Gasoline prices generally track crude prices, which fell below $18/bbl last week for the first time this year.
Although not near peak summertime levels, US gasoline demand remains healthy, up 1.3% during the fourth quarter of 2001 on a year-to-year basis, said API officials.
US inventories of both reformulated and conventional gasoline remain above both the average levels for this time of year and for the same period a year ago, API reported. Total crude input into the 152 US refineries last week was down 1% from a year ago. Production of distillate fuel, including both heating oil and diesel, was about even with year-ago production levels, exceeding 3.4 million b/d, said API.
