MARKET WATCH: Crude oil prices rebound Nov. 16 but falling again Nov. 17
Crude oil prices for December delivery rebounded on the New York market by $1/bbl on Nov. 16 to settle at $41.74/bbl, but then plunged to near $40/bbl in early Nov. 17 trading, which analysts attributed to a stronger dollar and concerns about lingering ample world oil supplies.
Raymond James & Associates Inc. issued a Nov. 16 note saying the attacks in Paris carry minimal relevance for oil demand.
“There may be a small negative effect on European demand if border controls end up reducing intra-EU travel,” RJA analyst Darren Horowitz said. “The more critical question is whether the attacks will spur a robust military response against the co-called Islamic State, and whether such a response will lead to oil supply disruptions.”
Horowitz noted Syria never was a significant oil producer. France launched airstrikes against Islamic State’s stronghold in Syria a day after French President François Hollande vowed a “merciless” response to the attacks on Paris.
The Wall Street Journal Dollar Index, which tracks the dollar against a basket of other currencies, rose 0.1% on Nov. 17. Many believe Federal Reserve officials will decide at a December meeting to raise interest rates.
Oil trades in dollars so a strengthening dollar makes oil more expensive for holders of other currencies.
Energy prices
The December crude oil contract on the New York Mercantile Exchange rose $1 on Nov. 17 to $41.74/bbl. The January crude oil contract gained 79¢ to $42.79/bbl.
The NYMEX natural gas contract for December gained 2.4¢ to a rounded $2.39/MMbtu. The Henry Hub gas price was up 13¢ at $2.14/MMbtu.
Heating oil for December delivery gained a fraction of a penny to a rounded $1.39/gal. The price for reformulated gasoline stock for oxygenates blending for December dropped a fraction of a penny to remain at a rounded $1.24/gal.
The January ICE contract for Brent crude increased 9¢ to $44.56/bbl. The February contract was up by 15¢ to $45.45/bbl. The ICE gas oil contract for December closed at $415/tonne, down $11.25.
The average price for the OPEC basket of 12 benchmark crudes for Nov. 16 was $38.18/bbl, down $1.03.
Contact Paula Dittrick at [email protected].
Paula Dittrick is editor of OGJ’s Unconventional Oil & Gas Report.
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.
