Market watch, Sept. 29
Energy futures prices weakened considerably in trading on the New York Mercantile Exchange Thursday. Comments by the Saudi crown prince that Saudi Arabia could raise production substantially at short notice formed the basis for trading.
Energy futures prices weakened considerably in trading on the New York Mercantile Exchange Thursday.
The November contract for light, sweet crudes declined by $1.12 to settle at $30.34/bbl on the NYMEX, while the December contract stood at $30.34, down by $1.05.
Refined petroleum products also closed lower, with October home heating oil losing 3.74� to settle at 91.06� per gallon, while unleaded gasoline for the same month declined by 5.38� to rest at 86.74�.
NYMEX natural gas for November delivery slumped by 32.3� to end at $5.12/Mcf.
Comments by Saudi Crown Prince Abdullah Bin Abdulaziz Al-Saud that his country could add more oil to the market if needed formed the basis of trading.
Later the country's petroleum and mineral resources minister, Ali I. Naimi, elaborated that Saudi Arabia was able to raise production by 1.5 million b/d within 30 days and up to 2 million b/d within 60 days, providing further selling incentive to traders.
However, in after-hours electronic access trading in New York today, light, sweet crude was fetching $30.46/bbl for the November position and $30.40 for the December contract, both up from the NYMEX close.
Meanwhile, in London Thursday, North Sea Brent crude oil futures also declined on the International Petroleum Exchange following the comments by the Saudi crown prince at the Organization of Petroleum Exporting Countries' summit in Venezuela.
Brokers took his pledge seriously, the more so because it was made very publicly and clearly meant as a warning to the market about persistently high futures prices.
IPE November Brent futures settled at $30.34/bbl, down by $1.28 from Wednesday's close, and looking set to test support at $30.
On the IPE, the October natural gas contract closed at the equivalent of $3.42, up 2�.
The price of the OPEC basket of seven crudes stood at $28.08/bbl Thursday, compared with $29.18 the previous day.