Sam Fletcher
Senior Writer
HOUSTON, Dec. 19 -- The price for the front-month contract for benchmark US crude fell below the $60/bbl mark Dec. 16 to a 2-week low on the New York Mercantile Exchange.
Natural gas and petroleum products also fell as predictions of milder winter weather allowed traders to take profits from recent price run-ups.
"Specifically, next week's weather is forecast to arrive 2.7% warmer vs. this past week on a [heating degree day] basis," said analysts at Raymond James & Associates Inc. Traders are now confident enough crude and natural gas are in US storage to meet winter demand.
Energy prices
The January contract for benchmark US light, sweet crudes fell by $1.93 to $58.06/bbl Dec. 16 on NYMEX. The February contract lost $2.05 to $59.05/bbl. On the US spot market, West Texas Intermediate at Cushing, Okla., was down by $1.93 to $58.07/bbl. Heating oil for January dropped 5.53¢ to $1.73/gal. Gasoline for the same month declined by 4.79¢ to $1.57/gal.
The January natural gas contract fell by 14.8¢ to $13.63/MMbtu "on forecasts for milder weather in most of the US for the first quarter of 2006," said analysts at Enerfax Daily. However, they said, "Home heating demand is expected to be 2% above normal through Dec. 23."
In London, the February contract for North Sea Brent crude dropped $2.27 to $57.13/bbl Dec. 16 on the International Petroleum Exchange. Gas oil for January fell by $28.50 to $515.25/tonne.
The average price for the Organization of Petroleum Exporting Countries' basket of 11 benchmark crudes lost $1.19 to $53.25/bbl on Dec. 16. So far this year, OPEC's basket price has averaged $50.59/bbl.
Contact Sam Fletcher at [email protected].
