Sam Fletcher
Senior Writer
HOUSTON, Aug. 3 -- Energy prices continued to climb Aug. 2 among ongoing concerns about future supplies and expectations that the Energy Information Administration would report this week another drop in US crude inventories.
However, EIA said Aug. 3 that commercial US crude stocks rose for the first time in 5 weeks, inching up by 200,000 bbl to 318 million bbl during the week ended July 29. Distillate fuel inventories were up by 1.5 million bbl to 127.3 million bbl during the same period, with a sharp increase in diesel fuel more than compensating for a decline in heating oil. Gasoline stocks plunged by 4 million bbl to 205.2 million bbl, indicating continued strong demand.
Imports of crude into the US increased by more than 1 million b/d to 11 million b/d during the week. The input of crude into US refineries was up by 283,000 b/d to 16 million b/d, with facilities operating at 95.8% of capacity. "However, gasoline and distillate fuel production decreased slightly, averaging nearly 8.7 million b/d and 4.3 million b/d, respectively," said EIA officials.
Meanwhile, US weather forecasters said the hurricane season this year will be worst than originally predicted, with as many as 21 tropical storms and 11 hurricanes that could strike US coasts along the Gulf of Mexico or the Atlantic. There already have been a record seven tropical storms in June and July, including two that became hurricanes. The hurricane season usually peaks between early August and late October before ending in late November.
Energy prices
Benchmark US light, sweet crudes for September delivery climbed by 32¢ to a new record closing of $61.89/bbl for a near-month contact on the New York Mercantile Exchange. The October position advanced by 17¢ to $62.87/bbl. On the US spot market, West Texas Intermediate at Cushing, Okla., was up by 32¢ to $61.90/bbl. Gasoline for September delivery jumped by 3.45¢ to $1.78/gal on NYMEX. Heating oil for the same month gained 0.98¢ to $1.76/gal.
The September natural gas contract escalated by 22.4¢ to $8.38/MMbtu, the highest price since November for a near-month contact on NYMEX . The summer heat and humidity blanketing much of the US increased the use of air conditioning and the demand for fuel to generate more electricity, said analysts at Enerfax Daily.
"With the [natural gas] market breaking to a new high, the technical picture looks decidedly bullish, but the market is overbought and due for a correction after a 14% surge in the last 6 sessions, particularly with milder weather on the way," they said.
In London, the September contract for North Sea Brent crude gained 18¢ to $60.62/bbl on the International Petroleum Exchange. Gas oil for August lost $5.25 to $529/tonne.
The average price for the Organization of Petroleum Exporting Countries' basket of 11 benchmark crudes increased by 92¢ to $55.12/bbl on Aug. 2.
Contact Sam Fletcher at [email protected]
