MARKET WATCH: NYMEX, Brent prices drop pending US weekly inventory

Sept. 27, 2017
Light, sweet crude oil prices dropped modestly on the New York market with the November contract settling below $52/bbl Sept. 26 while the Brent contract for November declined in London to settle below $59/bbl.

Light, sweet crude oil prices dropped modestly on the New York market with the November contract settling below $52/bbl Sept. 26 while the Brent contract for November declined in London to settle below $59/bbl.

The US Energy Information Administration was scheduled to release its weekly oil and products inventory Sept. 27. Analysts generally expected a modest increase in the weekly inventory.

Separately, traders and analysts said an independence vote in Kurdistan was causing some market fears of a possible oil supply disruption. Meanwhile, other analysts were hopeful of a future production-cut target extension from the Organization of Petroleum Exporting Countries and other producers although the timing on that remains uncertain.

“The latest rise in oil prices reflects concerns about Kurdish supply and hopes for another extension of OPEC’s output cuts, neither of which may have a lasting influence on prices,” Capital Economics report said. “But the oil market has become better balanced over the past year, suggesting that prices should remain fairly stable.”

Iraqi officials pressured Iraq’s Kurds on Sept. 27, demanding they cancel their vote for independence. The autonomous Kurdish-held northern Iraq favored secession in a Sept. 25 referendum, but the vote angered officials in nearby countries.

Iran and Turkey oppose Kurdish secession. Their armies recently started joint exercises near their borders with Iraqi Kurdistan. Iraq and Turkey have also held joint military drills.

Foreign airlines began suspending flights to Kurdish airports after the Iraqi Civil Aviation Authority said Sept. 26 that international flights to Erbil and Sulaimaniya would be suspended.

Energy prices

The November light, sweet crude contract on the New York Mercantile Exchange dropped 34¢ to settle at $51.88/bbl on Sept. 26. The December contract declined 33¢ to settle at $52.19/bbl.

The NYMEX natural gas price for October dropped less than 1¢ to a rounded $2.91/MMbtu. The Henry Hub cash gas price fell 2¢ to $2.95/MMbtu.

Heating oil for October declined by 1¢ to a rounded $1.85/gal. The NYMEX reformulated gasoline blendstock for October fell 2¢ to a rounded $1.70/gal on Sept. 26.

The Brent crude contract for November on London’s ICE dropped 58¢ to $58.44/bbl. The December contract was down 51¢ to $57.92/bbl. The gas oil contract for October delivery was $546.25/tonne, down $5.25.

OPEC’s basket of crudes for Sept. 26 was $56.43/bbl, up 81¢.

Contact Paula Dittrick at [email protected].