MARKET WATCH: Oil benchmarks start week lower

Oil benchmarks on the New York and London markets began the week lower Oct. 28 on uncertainty over whether the Organization of Petroleum Exporting Countries and its allies will cut oil output come December.

Russian News Agency TASS reported that Russian Deputy Minister of State for Petroleum Pavel Sorokin said Oct. 28 that it was too soon to discuss whether OPEC+ will make additional production cuts, as the slowing of US production would be a factor to watch ahead of the meeting. “Russia’s comments poured cold water on the oil markets Monday, causing price to fall,” AEGIS Energy Risk LLC said Oct. 29.

OPEC+ members are scheduled to meet Dec. 5-6 to review the current agreement which calls for curtailing oil output by 1.2 million b/d. That policy is set to expire at the end of March 2020.

Separately, natural gas traded higher Oct. 28, “driven by a return to winter focus with US weather forecasts highlighting the risk of a colder-than-normal outlook,” noted Ole Hansen, head of commodity strategy at Saxo Bank.

Energy prices

The light, sweet crude contract for December on the New York Mercantile Exchange fell 85¢ to $55.81/bbl on Oct. 28. The January contract increased 81¢ to settle at $55.90/bbl.

The NYMEX natural gas price for November rose almost 15¢ to a rounded $2.45/MMbtu. The December contract was up almost 10¢ to a rounded $2.56/MMbtu.

Ultralow-sulfur diesel for November fell just under 2¢ to a rounded $1.96/gal. The NYMEX reformulated gasoline blendstock for November dropped less than 1¢ to remain at $1.67/gal.

Brent crude oil for December dropped 45¢ to $61.57/bbl on London’s International Commodity Exchange. The January contract fell 48¢ to $61.25/bbl. The gas oil contract for November was $591.75/tonne on Oct. 28, down $6.

OPEC’s basket of crudes for Oct. 28 was $61.65/bbl, down 51¢.

Contact Mikaila Adams at [email protected].