MARKET WATCH: NYMEX crude price for January tops $41/bbl on weaker dollar

A weakening US dollar supported light, sweet crude oil prices on the New York market Dec. 3 with the January contract gaining more than $1/bbl to settle at $41.08/bbl following a volatile week for oil prices ahead of a scheduled meeting Dec. 4 in Vienna of members of the Organization of Petroleum Exporting Countries.
Dec. 4, 2015
3 min read

A weakening US dollar supported light, sweet crude oil prices on the New York market Dec. 3 with the January contract gaining more than $1/bbl to settle at $41.08/bbl following a volatile week for oil prices ahead of a scheduled meeting Dec. 4 in Vienna of members of the Organization of Petroleum Exporting Countries.

The dollar fell sharply against other major currencies after the European Central Bank announced smaller stimulus steps than some investors and economists anticipated.

Meanwhile, OPEC delegates gathered for a policy meeting even as OPEC staff suggested that oil prices likely will remain low well into 2016 regardless of what OPEC decides to do about production levels.

At that meeting, OPEC members decided to accommodate current production levels, which are more than 1 million b/d over the cartel’s current production quota. The group offered no specific numbers for a production ceiling or for its actual production. Most analysts peg OPEC’s actual production at about 31.2 million b/d. The group will next meet in June.

The Wall Street Journal reported during November that an analysis document WSJ obtained from the OPEC Economic Commission Board indicated world oil supplies will cap any upside potential for oil prices for months to come.

Separately, Venezuela led a group of countries pushing for a 5% production cut among OPEC members. Venezuela’s Oil Minister Eulogio Del Pino said prices could fall another $20/bbl unless OPEC trims its production.“The overproduction we have from OPEC is going to produce a catastrophe in the price,” Del Pino told reporters in Vienna before the meeting.

Most analysts had expected OPEC to maintain its production quota at 30 million b/d—a target that OPEC members routinely exceed (OGJ Online, Dec. 3, 2015).

Energy prices

The January crude oil contract on the New York Mercantile Exchange gained $1.14 to settle Dec. 3 at $41.08/bbl. The February contract was up $1.12 to $42.50/bbl.

The NYMEX natural gas contract for January gained 1.6¢ to a rounded $2.18/MMbtu. The Henry Hub gas price was $2.11/MMbtu on Dec. 3, down 6¢.

Heating oil for January delivery climbed 5.4¢ to a rounded $1.36/gal. The price for reformulated gasoline stock for oxygenates blending for January was up less than a penny to a rounded $1.30/gal.

The January ICE contract for Brent crude gained $1.35 to $43.84/bbl, and the February contract was up $1.27 to $44.43/bbl. The ICE gas oil contract for December closed at $395.25/tonne on Dec. 3, up $2.25.

The average price for OPEC’s basket of 12 benchmark crudes for Dec. 3 was $37.89/bbl, down 55¢.

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.

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