MARKET WATCHUS oil prices holding above $66/bbl

March 30, 2006
Crude futures prices held above $66/bbl for a second day in New York Mar. 29 amid concerns about militarism in Nigeria and Iran's nuclear program.

By OGJ editors
HOUSTON, Mar. 30 -- Crude futures prices held above $66/bbl for a second consecutive day on the New York market Mar. 29 amid supply and geopolitical concerns involving militant activity in Nigeria and Iran's nuclear program.

In Nigeria, authorities are hunting for militants hiding in forests and creeks of the Niger Delta. For the last 4 months, the militants have retreated to their camps after taking oil worker hostages and damaging pipelines in a series of attacks.

Regarding Iran, the UN Security Council issued a statement Mar. 29 giving Tehran 30 days to suspend uranium enrichment. The US and Europe worry that the uranium program is a front for nuclear weapons. Iran reportedly remained defiant and refused to halt uranium enrichment.

Meanwhile in New York markets, gasoline futures rose to their highest in nearly 6 months after a government report showed the biggest decline in US inventories of the product since August (OGJ Online, Mar. 29, 2006).

Energy prices
The May contract for benchmark US light, sweet crudes rose 38¢ to $66.45/bbl Mar. 29 on the New York Mercantile Exchange. The June contract gained 55¢ to $67.47/bbl. On the US spot market, West Texas Intermediate was up by 38¢ to $66.46/bbl.

Gasoline for April delivery climbed by 6.97¢ to $1.954/gal on NYMEX. Heating oil for the same month gained 2.43¢ to $1.852/gal. Gasoline supplies fell 5.34 million bbl, or 2.4%, to 216.2 million bbl last week, the biggest percentage drop since Aug. 12, the US Energy Department's weekly inventory report showed.

The April natural gas contract climbed by 1.9¢ to $7.233/MMbtu on NYMEX, "continuing to follow the whole crude oil complex up, now on worries over falling gasoline inventories as the summer driving season approaches," said analysts at Enerfax Daily.

In London, the May IPE contract for North Sea Brent crude increased by 58¢ to $65.55/bbl. Gas oil for April was up by $2.75 to $575.50/tonne.

The average price for the Organization of Petroleum Exporting Countries' basket of 11 benchmark crudes gained 90¢ to $59.95/bbl.