Market watch, Aug. 3
Energy futures prices closed generally higher in trading on the New York Mercantile Exchange Wednesday. News of a bullish inventory report helped a small rally. The weekly inventory report released by the American Petroleum Institute after the end of trading on Tuesday was unexpectedly bullish. The API said in its report that gasoline stocks had risen by 9.0 million barrels during the previous week, as imports declined by 2 million b/d.
Energy futures prices closed generally higher in trading on the New York Mercantile Exchange Wednesday.
The weekly inventory report released by the American Petroleum Institute after the end of trading on Tuesday was unexpectedly bullish. The API said in its report that US gasoline stocks had risen 9.0 million bbl during the previous week, as imports declined 2 million b/d. Traders viewed the decline in imports as very significant.
Analysts said the decline in US stocks was very intriguing as there was so much talk of output being increased by some major producers, while demand is declining.
NYMEX crude oil for September delivery rose 47� Tuesday to settle at $28.26/bbl, while the October contract stood at $27.97, up 39�. Refined petroleum products ended mixed, with September home heating oil rising 1.42� to settle at 78.26�/gal, and unleaded gasoline for the same month declining 0.29� to finish at 86.92�.
NYMEX natural gas for September delivery gained 22.8� to end at $4.22/Mcf.
Meanwhile in London trading on the International Petroleum Exchange, Brent crude oil futures rose sharply Wednesday afternoon, as the NYMEX market reacted strongly to news of the fall in US stocks. Brokers said the market seized upon this bullish news as justification for another attempt at a rally, and technical buying added to the upward momentum.
OPEC's caution, as suggested earlier by the OPEC president's letter to oil ministers, outlining the reasons why it would be unnecessary to boost production further in August, created a bullish sentiment (OGJ Online, Aug. 2, 2000).
Meanwhile, September Brent on the IPE settled Wednesday at $27.59/bbl, up 45� from the previous close. The day's high was $27.87 and the low was $27.50.
Also in London, the September natural gas contract closed at the equivalent of $2.54/Mcf, up 14�. And August gas oil also settled significantly higher at $245.75/tonne, up $5.75 from the previous close. The day's high was $246.25, and the low $243.
Traders on the Singapore exchange said Brent crude oil prices gained ground on reports OPEC would not increase production. September Brent settled at $27.59/bbl in Singapore, up 45�, while the October contract added 36� to close at $27.12.
The price of the OPEC basket of seven crudes stood at $25.90/bbl Wednesday, compared with $25.54 the previous day, according to the OPEC secretariat.