MARKET WATCH: NYMEX crude oil settles under $56/bbl
Light, sweet crude oil for November delivery fell moderately on the New York market Sept. 27 to settle just below $56/bbl while Brent crude oil for November delivery also fell in London to settle just below $62/bbl.
Oil benchmarks gradually are declining since both oil prices spiked to settle about $8/bbl higher on Sept. 16 after a Sept. 14 drone and missile attack on the Abqaiq oil processing plant and Khurais oil field belonging to Saudi Aramco. Saudi officials say they are quickly restoring production.
“The level of Saudi Arabia’s domestic inventories and production spare capacity both suggest that maintaining export levels is achievable,” Damien Courvalin, Goldman Sachs head of energy research, told the Wall Street Journal.
The incident is likely to have “a negligible impact” on commercial inventories held by Organization for Economic Cooperation and Development nations, Courvalin said.
Fitch Ratings on Sept. 30 downgraded Saudi Arabia, citing deterioration in Saudi’s economy and the recent attack on its oil infrastructure that temporarily knocked out half of its crude production. The rating agency dropped Saudi Arabia’s long-term foreign currency issuer default rating to A from A+, which means it remains in the upper medium investment grade. Fitch’s outlook is stable.
Separately, representatives of 13 banks surveyed by the Wall Street Journal during September expect Brent crude will average $64.31/bbl during the fourth quarter. The bankers’ Brent oil price forecast was almost unchanged from the forecast made in August and more than 10% below the forecast made a year ago.
Bankers expect light, sweet crude will average $58.24/bbl in the fourth quarter, barely changed from August’s forecast of $57.82/bbl.
Energy prices
Light, sweet crude oil prices on the New York Mercantile Exchange for November decreased 50¢ to $55.91/bbl on Sept. 27 while the December contract fell 49¢ to $55.79/bbl.
The November natural gas price dropped by nearly 4¢ to $2.40/MMbtu on Sept. 27.
Ultralow-sulfur diesel for October declined 1¢ to remain at a rounded $1.94/gal. The NYMEX reformulated gasoline blendstock for October fell 1¢ to $1.65/gal.
Brent crude for November dropped 83¢ to $61.91/bbl. The December contract fell 70¢ to settle at $61.04/bbl.
Gas oil for October rose $9 to $602.25/tonne on Sept. 27. The average for the Organization of Petroleum Exporting Countries’ basket of crudes for Sept. 27 was $62.51/bbl, up 20¢.
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.
