MARKET WATCH: NYMEX April oil price approaches $57/bbl on inventory draw
Light, sweet crude oil prices for April rose more than $1/bbl to approach $57/bbl after a US government weekly oil inventory reported showed a draw in oil supplies.
US crude oil inventories for the week ended Feb. 22, excluding the Strategic Petroleum Reserve, decreased by 8.6 million bbl from the previous week, the US Energy Information Administration estimated in its weekly report (OGJ Online, Feb. 27, 2019).
At 445.9 million bbl, US crude oil inventories are about 3% above the 5-year average for this time of year, EIA said in the Petroleum Status Report.
US oil production gained 100,000 b/d for the week ended Feb. 22 to total 12.1 million b/d, the report said. Most of the production gain came from across the Lower 48 states.
Meanwhile, Saudi Arabia’s energy minister reiterated Saudi’s commitment to reduce oil production after US President Donald Trump suggested earlier in the week in a tweet that oil prices were too high.
Analysts said uncertainty about oil supply continues to support oil prices given US sanctions on Iran and Venezuela.
Iran and Venezuela were exempted from an agreement in December 2018 in which the Organization of Petroleum Exporting Countries and some non-OPEC producers agreed to lower production.
The Wall Street Journal reported Feb. 25 that Saudi Arabia and other OPEC members are likely to support a continuation of production-cut targets when the group meets in April.
Energy prices
The April contract for light, sweet crude oil on the New York Mercantile Exchange rose $1.44 to settle at $56.94/bbl on Feb. 27. The contract for May delivery increased $1.40 to settle at $57.37/bbl.
NYMEX natural gas for April edged up less than 1¢ to a rounded $2.80/MMbtu on Feb. 27.
Ultralow-sulfur diesel for March rose 2¢ to $2.02/gal. The NYMEX reformulated gasoline blendstock for March increased nearly 5¢ to a rounded $1.63/gal.
Brent crude for April delivery gained $1.18 to settle at $66.39/bbl while the May contract also increased $1.22 to settle at $66.58/bbl. The gas oil contract for March gained $8 to $623.75/tonne on Feb. 27.
The average price for OPEC’s basket of crudes was $64.97/bbl on Feb. 27, up 89¢.
Contact Paula Dittrick at [email protected].
Paula Dittrick | Senior Staff Writer
Paula Dittrick has covered oil and gas from Houston for more than 20 years. Starting in May 2007, she developed a health, safety, and environment beat for Oil & Gas Journal. Dittrick is familiar with the industry’s financial aspects. She also monitors issues associated with carbon sequestration and renewable energy.
Dittrick joined OGJ in February 2001. Previously, she worked for Dow Jones and United Press International. She began writing about oil and gas as UPI’s West Texas bureau chief during the 1980s. She earned a Bachelor’s of Science degree in journalism from the University of Nebraska in 1974.
