By OGJ editors
HOUSTON, Nov. 7 -- Energy prices retreated Thursday from the previous session's rally on the New York Mercantile Exchange, with only the near-month natural gas position losing all of its earlier gain (OGJ Online, Nov. 6, 2003). Some analysts previously speculated that Wednesday's rally probably was overdone and that energy prices would soon correct to lower levels as traders took profits from that runup.
The contract for benchmark US light, sweet crudes for December delivery lost 4¢ to close at $30.26/bbl Thursday on NYMEX. The January contract fell 16¢ to $29.97/bbl. On the US spot market, West Texas Intermediate at Cushing, Okla., lost 10¢ to $30.23/bbl.
Refined petroleum products also closed lower with heating oil for December delivery losing 0.4¢ to 82.22¢/gal on NYMEX, while unleaded gasoline for the same month fell 0.97¢ to 81.42¢/gal.
The December natural gas contract on NYMEX tumbled by 23.9¢ to $4.66/Mcf, wiping out its 17¢/Mcf gain from the previous session, "despite a higher cash market," said analysts Friday at Enerfax Daily. Natural gas futures prices, according to Enerfax, were "hit by a steady flood of technical selling when an early attempt to rally on a firm cash market, cold weather, and supportive weekly inventory data quickly stalled."
The January contract for natural gas on NYNEX settled 20.9¢ lower as well, at $4.91/Mcf, Enerfax reported. "The market opened steady [Thursday] and briefly jumped above $5[/Mcf] after the [US Energy Information Administration] released last week's storage data about midmorning, but quickly dipped below $4.70[/Mcf] by noon, and mostly traded there at $4.65[/Mcf] for the rest of the day," Enerfax analysts said.
"Technical selling, possibly funds, kicked in early when an attempt to rally on the EIA report quickly stalled at resistance in the remaining gap to $5.04[/Mcf]," Enerfax said.
Regarding natural gas storage, Enerfax predicted that next week's figures should reflect a 15-25 bcf injection compared to a 48 bcf withdrawal a year ago.
Other prices
In London Thursday Brent crude oil futures prices settled lower on the International Petroleum Exchange, reportedly due to the sharp rise in futures values seen earlier in the week that were perceived by the market to be overdone.
IPE December Brent futures settled at $28.41/bbl, a decline of 19¢ from the previous day's close. Trading Thursday ranged from a high of $28.92/bbl to a low of $28.20/bbl. Gas oil for November delivery lost 75¢ to $259/tonne. The December natural gas contract dipped by 5.1¢ to the equivalent of $6/Mcf on IPE.
The price of the Organization of Petroleum Exporting Countries' basket of seven crudes closed at $27.84/bbl Thursday, which was a $1.35 jump from the previous day.
