MARKET WATCH: NYMEX falls more than $2/bbl on OPEC forecast

Crude oil prices fell by more than $2/bbl on the New York market Jan. 15 while Brent prices dropped by about $1/bbl after the Organization of Petroleum Exporting Countries issued a monthly report in which OPEC reduced its 2015 estimated OPEC oil demand.

Paula Dittrick

Jan. 16, 2015

2 min read

The revised forecast was 28.8 million b/d for 2015, which was 100,000 b/d less than OPEC forecast in its December Monthly Oil Market Report. The January MOMR estimated 2014 demand for OPEC crude oil at 29.1 million b/d.

Oil prices have plummeted by more than 50% since June 2014. Both US light, sweet crude oil prices and Brent prices repeatedly reached 5-year lows in December.

Oil prices showed at least a temporary rebound in early trading on Jan. 16 after the International Energy Agency in Paris said a reversal in the oil-price drop was possible this year, although IEA said prices could fall more before the market begin to rise.

“How low the market’s floor will be is anybody’s guess,” IEA said. “A price recovery—barring any major disruption—may not be imminent, but signs are mounting that the tide will turn.”

A rebalancing of the market might “begin to occur” in the second half, IEA said in its Oil Market Report for January.

Energy prices

The NYMEX February crude oil contract dropped $2.23 on Jan. 15, closing at $46.25/bbl. The March contract fell $2.23 to $46.73/bbl.

The natural gas contract for February was down 7.5¢ to a rounded $3.16/MMbtu. The cash gas price at Henry Hub, La., rose 17¢ to $3.29/MMbtu on Jan. 15.

Heating oil for February was down 3¢ to a rounded $1.62/gal. Reformulated gasoline stock for oxygenate blending for February declined 5¢ to a rounded $1.30/gal.

The February ICE contract for Brent crude oil fell $1.02 to settle at $47.67/bbl. The March contract dropped $1.59 to $48.27/bbl. The ICE gas oil contract for January was up $14.50 to $473/tonne.

The average price for OPEC’s basket of 12 benchmark crudes on Jan. 15 was $43.14/bbl, up $1.49 from the previous day.

Contact Paula Dittrick at [email protected].

*Paula Dittrick is editor of OGJ’s Unconventional Oil & Gas Report.

About the Author

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.