By OGJ editors
HOUSTON, Nov. 12 -- Crude oil futures prices rose in trading on the New York Mercantile Exchange Tuesday along with heating oil and gasoline prices while natural gas futures climbed for a third consecutive session.
Meanwhile, Singapore's Defense Minister said maritime terrorism was a threat, particularly for vessels moving energy products. The warning came days after an oil tanker and a ship carrying liquefied petroleum gas were boarded by armed pirates in nearby Indonesian waters, Dow Jones Newswires reported.
"For terrorists, the payoff from a successful maritime attack could be considerable," Dow Jones quoted Teo Chee Hean as saying earlier this week in a speech opening a maritime defense convention in Singapore. "The damage could be horrific if terrorists turned supertankers, LPG, LNG, or chemical carriers into floating bombs."
US natural gas
C. H. Guernsey & Co., Oklahoma City, has revised its stored gas, peak-level prediction going into the 2003-04 heating season. Economists Donald Murry and Zhen Zhu estimate natural gas levels, injected during the week ended Nov. 7, at 28-36 bcf.
At this injection level, the US Energy Information Administration is expected to estimate at least 3.18 tcf in storage at the heating season start. Given current weather forecasts, Guernsey predicted the first storage draw down, at 28 bcf, for this week. The EIA reported 3.16 tcf in storage as of Oct. 31, which was 1% higher than the 5-year average for that period.
Murry, Guernsey vice-president, said this level of stored natural gas is significant enough to influence winter prices, providing that the winter is not worse than normal.
A normal winter draw down would leave approximately 1.2 tcf in storage on Mar. 31, Murry said. That would compare favorably with 623 bcf of gas in storage at the end of the 2002-03 heating season.
Meanwhile US Energy Sec. Spencer Abraham told reporters at the National Press Club Monday that gas inventories have rebounded, easing concerns about possible tight supplies and price spikes this winter.
Energy prices
The December and January contracts for benchmark US light, sweet crudes rose Tuesday on NYMEX. The December contract climbed by 27¢ to $31.15/bbl, and the January contract rose by 28¢ to $30.90/bbl.
On the cash spot market, West Texas Intermediate crude at Cushing, Okla., climbed 27¢ to $31.15/bbl Tuesday.
Refined petroleum products also closed higher. Unleaded gasoline for December delivery rose 1.94¢ to 84.38¢/gal Tuesday on NYMEX. Heating oil for the same month gained 1.19¢ to 84.41¢/gal.
The jump in gasoline prices, marking a 2-week high, is unusual for this time of the year. Traders said the gain in gasoline apparently stemmed from market nervousness after the Sunday terrorist attack in Saudi Arabia.
Natural gas for December delivery rose 15.8¢ to $4.869/Mcf Tuesday on NYMEX.
Gas prices rose along with crude oil futures and a firmer natural gas cash market, said Enerfax Daily analysts Wednesday. They attributed the higher gas price to "mainly a technical rally, partly sparked by rising oil prices."
In London, the December contract for North Sea Brent oil settled at 29.09/bbl, up by 10¢ from the previous close on the International Petroleum Exchange.
Gas oil for November delivery held steady at $260.50/tonne. The December natural gas contract shot up by 30¢ to the equivalent of $5.38/Mcf Tuesday on IPE.
The average price for the Organization of Petroleum Exporting Countries' basket of seven benchmark crudes gained 5¢ to $28.63/bbl Tuesday.
