Sam Fletcher
Senior Writer
HOUSTON, Jan. 13 -- Oil prices continued to rise Monday, with record-low inventories vulnerable to supply disruptions, but prices for near-month contracts for natural gas and petroleum products retreated.
The February natural gas contract lost 38.1¢ to $6.91/Mcf on the New York Mercantile Exchange, while the March position was down by 27.6¢ to $6.92/Mcf, wiping out Friday's price surge for both contracts. "Other months ended mixed, with 2005-09 contracts finishing up slightly," analysts reported Tuesday at Enerfax Daily. They said the NYMEX gas market was "pressured by a soft cash [spot] and mild early-week weather, but colder temperatures later this week could lead to another big rally."
The analysts said, "There is a lack of real cold weather right now, but there is the potential for some very cold temperatures coming later this week that make many traders unwilling to give up on the upside yet. Private forecasters call for below-normal temperatures for the Northeast [US] for the next 6-10 days."
They also cited "concerns about declining [North American natural gas] production and a stronger economy that should boost industrial demand in the first quarter through the summer."
Product futures slip
Heating oil for February delivery slipped by 0.19¢ to $1.008/gal Monday, giving up only a small portion of its gain from the previous NYMEX trading session. Unleaded gasoline for the same month dipped by 0.75¢ to $1.016/gal.
However, the February contract for benchmark US light, sweet crudes continued to climb, up 41¢ Monday to $34.72/bbl on NYMEX, while the March contract increased by 37¢ to $34.40/bbl. On the US spot market, West Texas Intermediate gained 41¢ to $34.73/bbl.
In London, the February contract for North Sea Brent oil advanced by 39¢ to $31.76/bbl on the International Petroleum Exchange. Brokers said prices are likely to remain volatile with a high degree of speculative trading in that market. The January gas oil contract expired Monday unchanged at $293.75/tonne, but the new front-month February contract lost $2 to $284.50/tonne.
The February natural gas contract plunged by 23.2¢ to the equivalent of $5.46/Mcf Monday on IPE.
The average price for the Organization of Petroleum Exporting Countries' basket of seven benchmark crudes inched by 8¢ to $30.96/bbl Monday.
Contact Sam Fletcher at [email protected]
