MARKET WATCHEnergy futures prices continue to rise

Energy futures prices continued to escalate Friday due mostly to technical trading, analysts said. The increased trading was in light of the market rise on Thursday, and in particular crude oil's move to test its current ceiling price of $30/bbl.

June 2, 2003

2 min read

By OGJ editors
HOUSTON, June 2 -- Energy futures prices continued to escalate Friday due mostly to technical trading, analysts said. The increased trading was in light of the market rise on Thursday, and in particular crude oil's move to test its current ceiling price of $30/bbl.

In New York Friday, the Judy contract for the benchmark US light, sweet crudes increased by 46¢ to close at $29.56/bbl on the New York Mercantile Exchange. The August NYMEX contract also made gains, reaching $28.49/bbl, up 40¢.

Refined products also advanced. June heating oil for June delivery rose by 77¢ to close at 75.42¢/gal, while gasoline for the same month was up 0.62¢ to 86.77¢/gal.

Meanwhile, the July natural gas contract soared 18.5¢ to close at $6.25/Mcf on NYMEX. The August contract gained 18.2¢ reaching $6.21/Mcf. This increase was "driven by a firm physical market and some follow through technical buying after Thursday's strong close," said analysts Monday at Enerfax Daily.

"The market opened higher and jumped above $6.20(/Mcf) early," Enerfax reported, "but quickly consolidated between there and $6.15(/Mcf) until early afternoon prices again headed higher, closing on the upswing."

Enerfax noted that in spite of this latest gas rally, "traders are expecting lagging cash, still 20¢ below futures, and mostly mild weather forecasts for the next 2 weeks to limit the upside near term." In recent weeks, Enerfax added, "(natural gas) injections (into underground storage) have exceeded expectations based on weather alone, leading some to believe that the overall balance was loosening as more supply comes on line and high prices slow demand."

In London, the July contract for North Sea Brent lost 42¢ Tuesday to $25.82/bbl on the International Petroleum Exchange. IPE was closed on Monday for a holiday.
The June natural gas contract inched up 1.5¢ to the equivalent of $2.74/Mcf on IPE.

The average price for the Organization of Petroleum Exporting Countries' basket of seven benchmark crudes climbed 44¢ to $26.71/bbl Friday.