MARKET WATCH: NYMEX, Brent crude prices rebound

Crude oil prices on the New York and London markets regained some ground May 20 with US light, sweet crude oil prices for July climbing nearly $1/bbl to close at just under $59/bbl on the heels of a government report that US oil inventories dropped for a third consecutive week.

Crude oil prices on the New York and London markets regained some ground May 20 with US light, sweet crude oil prices for July climbing nearly $1/bbl to close at just under $59/bbl on the heels of a government report that US oil inventories dropped for a third consecutive week.

The gain in oil prices snapped a five-session losing streak on the New York market.

The US Energy Information Administration estimated commercial crude oil inventories, excluding the Strategic Petroleum Reserve, decreased 2.7 million bbl for the week ended May 15 to 482.2 million bbl.

On Apr. 21, EIA estimated natural gas in underground storage across the Lower 48 at a rounded 1.99 tcf as of May 15. This represented a net increase of 92 bcf from the previous week.

Stocks were 738 bcf higher than last year at this time and 35 bcf below the 5-year average of 2 tcf, the weekly Natural Gas Storage report showed.

Separately, the EIA said net gas imports (imports minus exports) totaled 1.17 tcf in 2014, the lowest level since 1987.

“US net imports of natural gas decreased 9% in 2014, continuing an 8-year decline,” EIA said in its “Today in Energy” brief. “As US dry natural gas production has reached record highs, lower domestic prices have helped to displace natural gas imports.”

Imports by pipeline from Canada account for nearly 98% of US gas imports, and were the main driver of the decrease in total imports. Net imports from Canada represented 7% of US gas consumption in 2014, down from 11% in 2009.

US gas exports also decreased in 2014, but at a slower rate than the decrease in imports, and were still 9% above the previous 5-year average. Gas exports to Mexico, which account for nearly 50% of US gas exports, increased 12% in 2014.

Net imports of LNG in 2014 totaled 43 bcf, down 54% from the level in 2013, and continued a 5-year decline. LNG exports increased from 2013 levels, but not enough to offset a nearly 40% decrease in total LNG imports in 2014, EIA said.

Energy prices

The June crude oil contract on the New York Mercantile Exchange gained 99¢ on May 20 to settle at $58.98/bbl. The July contract rose $1 to settle at $59.47/bbl.

The natural gas contract for June declined 3¢ to a rounded $2.92/MMbtu. The Henry Hub, La., gas price was $2.99/MMbtu, down 8¢.

Heating oil for June edged up 1.7¢ a rounded $1.95/gal. The price for reformulated gasoline stock for oxygenates blending for June increased 4.6¢ to a rounded $2.04/gal.

The July ICE contract for Brent crude climbed $1.01 to $65.03/bbl while the August contract gained 97¢ to $65.52/bbl, respectively. The ICE gas oil contract for June was down 50¢ to $592.75/tonne.

The average price for the OPEC’s basket of 12 benchmark crudes for May 20 was $60.91/bbl, down 20¢.

Contact Paula Dittrick at paulad@ogjonline.com.

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

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