By OGJ editors
HOUSTON, Apr. 4 -- Energy futures prices regressed Wednesday as international markets adjusted from earlier spikes this week.
The May contract for benchmark US sweet, light crudes dropped 15¢ to $27.56/bbl on the New York Mercantile Exchange, while the June position lost 18¢ to $27.66/bbl. However, both rebounded in after-hours electronic trading to $27.65/bbl and $27.76/bbl, respectively.
Unleaded gasoline for May delivery fell 2.14¢ to 84.84¢/gal, wiping out the previous day's gain of 2.08¢. Natural gas for the same month was rolled back 14.8¢ to $3.51/Mcf, nullifying Tuesday's gain of 12.3¢. The May heating oil contract dipped 0.12¢ to 70.83¢/gal on the NYMEX.
The American Gas Association reported early Wednesday an unexpectedly heavy withdrawal of 65 bcf of natural gas from US underground storage last week, compared with drawdowns of 69 bcf the previous week and 51 bcf during the same period a year ago.
That ended the traditional winter withdrawal season with a little more than 1.4 tcf of gas still in storage, up 804 bcf from last year. "We now expect storage levels entering next winter at the beginning of November to be at 3-3.1 tcf, based on an expected 2% year-over-year decline in domestic natural gas production," with a projected growth of 2.9% in the US gross domestic product, said Robert Morris of Salomon Smith Barney Inc.
That economic growth should increase US demand for natural gas by an additional 1.75 bcfd, or 3%, this year, Morris reported Thursday.
In London, the May contract for North Sea Brent oil retreated 39¢ to $27.27/bbl on the International Petroleum Exchange. The June Brent contract also was down 43¢ to $27.05/bbl. Natural gas for May delivery lost 8.3¢ to the equivalent of $1.80/Mcf on the IPE.
However, oil futures prices continued to climb in Asian markets, passing the $26/bbl mark in overnight trading on the Tokyo Commodity Exchange, with continued political uncertainty in the Middle East.
The average price for the Organization of Petroleum Exporting Countries' basket of seven benchmark crudes declined 11¢ to $25.83/bbl Wednesday.
