MARKET WATCHCrude oil futures prices rise on OPEC cut anticipations
By OGJ editors
HOUSTON, Feb. 10 -- Oil and refined products futures prices rose Monday in New York and London markets as some Organization of Petroleum Exporting Countries oil ministers said they might adjust production quotas or else reign in existing overproduction by members.
Following a brief extraordinary meeting Tuesday in Algiers, OPEC announced that it decided to reduce the production ceiling by 1 million b/d to 23.5 million b/d, effective Apr. 1. This will be distributed pro rata among members.
The OPEC Conference reiterated that the next ordinary meeting is Mar. 31 in Vienna, and that an extraordinary meeting is June 3 in Beirut.
Energy prices
The March contract for benchmark US light, sweet crudes gained 35¢ to $32.83/bbl Monday on the New York Mercantile Exchange, while the April contract rose by 29¢ to $32.03/bbl.
On the US spot market, West Texas Intermediate at Cushing, Okla., rose by 35¢ to $32.83/bbl.
Unleaded gasoline for March delivery rose by 0.60¢ to 96.75¢/gal. Heating oil for the same month also closed higher, rising 1.51¢ to 87.96¢ /gal.
The March natural gas contract dipped by 0.005¢ to $5.349/Mcf on NYMEX. "Early buying on a firmer cash market was offset by more long liquidation on concerns about moderate Northeast [US] weather this week," said analysts at Enerfax Daily.
In London, the March contract for North Sea Brent closed at $29.11/bbl Monday, up 28¢ for the day on the International Petroleum Exchange. The day's high was $29.18/bbl as early trading reacted to growing market expectations that OPEC will cut its production ceiling or make an effective cut by tightening production discipline.
The March natural gas contract lost 7¢ to the equivalent of $4.00/Mcf on IPE. Gas oil for February delivery rose by $2.25 to $249.25/tonne.
OPEC's average price for its seven benchmark crudes fell by 11¢ to $28.09/bbl Monday.