MARKET WATCHCrude futures top $66/bbl in New York, London markets

Aug. 15, 2005
Crude futures prices pushed past $66/bbl to new highs Aug. 12 in both the New York and London markets as international tensions and refinery outages continued to fan trader's fears of supply shortages.

Sam Fletcher
Senior Writer

HOUSTON, Aug. 15 -- Crude futures prices pushed past $66/bbl to new highs Aug. 12 in both the New York and London markets as international tensions and refinery outages continued to fan trader's fears of supply shortages.

With less than a month left in the traditional US summer driving season, about a dozen refineries have been forced to reduce capacity in recent weeks. The latest, a 190,000 b/d Memphis, Tenn., refinery operated by Premcor Inc., one of the largest US independent refiners, suffered a power outage. Meanwhile, US demand for gasoline has grown by 1.4% from year-ago levels in recent weeks.

Energy prices
The September contract for benchmark US light, sweet crudes jumped by $1.06 to a record front-month closing of $66.86/bbl, having touched a new 22-year high of $67.10/bbl during the trading session on the New York Mercantile Exchange. The October contract advanced by 62¢ to $67.37/bbl. All other crude futures contracts through May 2006 on NYMEX also exceeded $67/bbl. On the US spot market, West Texas Intermediate at Cushing, Okla., climbed by $1.06 to $66.87/bbl.

Gasoline for September delivery escalated by 5.5¢ to $2/gal. Heating oil for the same month edged up by 0.7¢ to $1.91/gal. The September natural gas contract jumped by 28.7¢ to $9.59/MMbtu on NYMEX, driven by "another record rally in crude oil prices and continued heat over much of the nation causing record power demand," said analysts at Enerfax Daily.

In London, the September contract for North Sea Brent crude hit an all-time front-month high of $66.77 during trading Aug. 12 before settling at a record $66.45/bbl, up by $1.07 for the day, on the International Petroleum Exchange. Gas oil for September increased by $3.75 to $601/tonne.

The average price for the Organization of Petroleum Exporting Countries' basket of 11 benchmark crudes was up by 86¢ to $59.14 bbl on Aug. 12. OPEC's basket price has averaged $48.09/bbl so far this year.

Contact Sam Fletcher at [email protected]