Sam Fletcher
Senior Writer
HOUSTON, Feb. 9 -- Energy prices inched up on Feb. 8, with natural gas futures climbing back above $6/MMbtu as markets adjusted from the large selloff in the previous trading session.
Meanwhile, the Energy Information Administration on Feb. 9 reported a decline in US crude and distillate fuel inventories for the second consecutive week. Commercial US crude stocks fell by 1 million bbl to 294.3 million bbl during the week ended Feb. 4. Distillate fuel inventories plunged by 3 million bbl to 115.5 million bbl during the same period and are now in the lower half of the average range for this time of year, said EIA. Gasoline inventories increased by 500,000 bbl to 216.8 million bbl, in the upper half of the average range for this period.
US imports of crude increased by 28,000 b/d to 9.9 million b/d in the week ended Feb. 4. Gasoline imports averaged 900,000 b/d, "the highest weekly average so far in 2005," EIA reported. "This may indicate that suppliers have begun to shift their focus back towards gasoline."
However, crude input into US refineries dropped by 176,000 b/d to more than 15 million b/d in the same period, with refineries operating at 90% of capacity. Distillate fuel production decreased to 3.8 million b/d, while gasoline production increased slightly to nearly 8.6 million b/d.
Energy prices
The March contract for benchmark light, sweet crudes bumped up by 12¢ to $45.40/bbl Feb. 8 on the New York Mercantile Exchange. The April contract increased by 10¢ to $46.06/bbl. On the US spot market, West Texas Intermediate at Cushing, Okla., was up by 12¢ to $45.41/bbl. Heating oil for March delivery increased by 1.54¢ to $1.25/gal on NYMEX. Gasoline for the same month inched up by 0.4¢ to $1.22/gal.
The March natural gas contract jumped by 19.5¢ to $6.16.MMbtu Feb. 8 on NYMEX, "buoyed by steady short-covering (buying to protect against excess exposure on natural gas sales contracts) after overnight weather models turned a bit colder," said analysts at Enerfax Daily. Concerns about a possible upward revision this week by EIA of the previous low draw of natural gas from US underground storage during the week ended Jan. 28 encouraged more short covering, they said.
However, the analysts said, "Only limited upside is expected, with storage levels still high and winter winding down."
In London, the March contact for North Sea Brent crude inched up by 3¢ to $43.07/bbl on the International Petroleum Exchange.
The average price for the Organization of Petroleum Exporting Countries' basket of seven benchmark crudes continued to decline Feb. 8, down by 19¢ to $39.79/bbl.
Contact Sam Fletcher at [email protected]
