Market watch: Oil prices rise in nervous markets

By the OGJ Online Staff

HOUSTON, Jan. 28 -- Oil prices continued to rise in international markets Friday, with nervous traders still looking for confirmation that promised curtailments of production and exports will bring world supply and demand into balance.

The March contract for benchmark US light, sweet crudes gained 29¢ to $19.99/bbl on the New York Mercantile Exchange, while the April contract was up 30¢ to $20.23/bbl. Prices continued to rise in after-hours electronic trading to $20.15/bbl and $20.40/bbl, respectively.

The February contract for unleaded gasoline bumped up 1.43¢ to 58.28¢/gal Friday. Home heating oil for the same month rose 0.34¢ to 53.73¢/gal.
However, natural gas for February delivery dipped 1.1¢ to $2.04/Mcf on the NYMEX.

In London, North Sea Brent oil settled higher after a week of mainly range-bound trading on the International Petroleum Exchange.

The March futures contract for North Sea Brent was up 24¢ to $19.37/bbl Friday. However, brokers viewed that increase as precarious and predicted that prices could fall swiftly with any sign of over-production or increased oil inventories.

US oil stocks currently are in line with market expectations, analysts said. The American Petroleum Institute's next weekly report on US petroleum inventories is scheduled for release Tuesday after the close of NYMEX.

The February natural gas contract dropped 5.5¢ Friday to the equivalent of $3.36/Mcf on the IPE.

The average price for the Organization of Petroleum Exporting Countries' basket of seven benchmark crudes gained 27¢ to $18.51/bbl Friday.

For the full week, however, the average basket price was down 12¢ to $17.69/bbl.

So far this year, OPEC's basket price has averaged $18.33/bbl. That's up from an average price of $17.53/bbl in December, but slightly below the average of $18.38/bbl during the fourth quarter of last year.

OPEC's basket price averaged $23.12/bbl for all of 2001 and $27.60/bbl during 2000.