MARKET WATCH: Brent crude oil price gains on Libya supply news

Light, sweet crude oil prices for April delivery dropped slightly on the New York market Mar. 6 while still holding above $53/bbl while the Brent crude oil contract for May delivery rose on the London market to settle just above $56/bbl after reports of conflicts in Libya.

Libya oil experts were halted at two major ports. Consequently, oil production was reduced from some oil fields associated with those ports. Media reports said security concerns led to suspension of crude shipments from Es Sider and Ras Lanuf.

The Benghazi Defense Brigades reportedly seized the Es Sider export terminal on Mar. 3. Libya has been rebuilding its oil production and exports in recent months (OGJ Online, Dec. 22, 2016).

Separately, the International Energy Agency issued a report saying the world could run low on oil supply after 2020, which could hike future oil prices. The demand and supply trends point to a tight global oil market, with spare production capacity in 2022 falling to a 14-year low (OGJ Online, Mar. 7, 2017).

Energy prices

The crude oil contract for April delivery on the New York Mercantile Exchange dropped 13¢ on Mar. 6 to $53.20/bbl. The May contract was down 7¢ to $53.71/bbl.

The natural gas price for April rose 7¢ at a rounded $2.90/MMbtu. The cash gas price at the Henry Hub closed at $2.68/MMbtu, up 17¢.

Heating oil for April climbed 1¢ to a rounded $1.60/gal. Reformulated gasoline stock for oxygenate blending for April gained nearly 2¢ to a rounded $1.67/gal.

The Brent crude contract for May on London’s ICE was up 11¢ to $56.01/bbl. The Brent June contract gained 10¢ to $56.26/bbl. Gas oil closed at $486.75/tonne, up $2.75.

The average price for the Organization of Petroleum Exporting Countries’ basket of benchmark crudes on Mar. 6 was $53.09/bbl, up 12¢.

Contact Paula Dittrick at paulad@ogjonline.com.