Paula Dittrick
Senior Staff Writer
HOUSTON, Nov. 7 -- Crude prices on the New York Mercantile Exchange briefed touched $97.10/bbl before dropping to settle at a record $96.80/bbl on Nov. 6, largely upon news of an attack upon a Yemen oil pipeline compound earlier in the week.
Analysts said the bombing intensified concerns about interruptions to global crude oil supply amid high oil demand. Elsewhere, Mexico's Tabasco state reported severe flooding spared onshore oil fields north of the heavily-damaged Villahermosa.
State-run Pemex indicated no major impact upon Tabasco state oil production. But media reports said numerous oil workers were forced to evacuate their homes.
In Yemen, unidentified saboteurs bombed a pipeline Nov. 5 in Marib province, causing damage but no fatalities. The pipeline reported was repaired within 24 hours. It a capacity of carrying 155,000 b/d of crude oil from Safer oil fields to a Red Sea export terminal.
US inventory down
The US Energy Information Administration reported Nov. 7 that crude oil inventories fell by 800,000 bbl to 311.9 million bbl. The anticipated drop marked the third consecutive decline in the government's weekly inventory numbers. Gasoline inventories fell by 800,000 bbl while distillates increased by 100,000 bbl.
In a short-term energy outlook released Nov. 6, the EIA said global oil markets are likely to remain stretched because world oil demand continues to grow faster than oil supply outside of the Organization of Petroleum Exporting Countries.
That situation puts pressure on OPEC and inventories to bridge the gap, EIA said. The EIA forecast spot West Texas Intermediate prices will average $86.93/bbl during the fourth quarter. It forecast prices will average $82.33/bbl during the first quarter of 2008.
Energy prices
In Nov. 6 trading on NYMEX, the December contract rose $2.72 to $96.70/bbl while the January contract gained $2.68 to $95.80/bbl.
On the US spot market, WTI at Cushing, Okla., held steady at $93.99/bbl. The December contract for reformulated blend stock for oxygenate blending (RBOB) rose by 5.39¢ to $2.435/gal on NYMEX. Heating oil for the same month gained 6.07¢ to $2.61/gal.
The December natural gas contract fell 13.6¢ to $7.86/MMbtu on NYMEX. On the US spot market, however, gas at Henry Hub, La., jumped 39¢ to $7.20/MMbtu.
In London, the December IPE contract for North Sea Brent crude climbed $2.77 to $93.26/bbl.
The average price for the OPEC basket of 12 reference crudes increased by $1.00 to $89.13/bbl on Nov. 6.
Contact Paula Dittrick at [email protected]
