Market watch, Dec. 19
The weatherman continued to set international energy futures prices, pushing them up Monday with forecasts of another wave of cold weather for key Northeast US markets. On the New York Mercantile Exchange, the January contract for benchmark US light, sweet crudes climbed 88� to $28.87/bbl.
The weatherman continued to set international energy futures prices, pushing them up Monday with forecasts of another wave of cold weather for key Northeast US markets.
The US winter season so far has been roughly 35% colder than the same period a year ago. Temperatures as measured in heating degree days, weighted by gas home heating customers, were roughly 21% lower last week than last year and 15% lower than the 10-year average.
Current projections continue to indicate colder than normal temperatures during the last half of December, officials said.
On the New York Mercantile Exchange, the January contract for benchmark US light, sweet crudes climbed 88� to $28.87/bbl Monday, while the February contract was up 69� to $27.86.
Home heating oil for January delivery jumped by 2.77� to 91.66�/gal, while unleaded gasoline for the same month rose 1.2� to 75.67�/gal.
The January contract for natural gas rose 98.3� to $8.396/Mcf on the NYMEX.
Robert Morris, energy analyst at Salomon Smith Barney Inc., predicted in his Monday report that the American Gas Association this week will reveal a withdrawal of 145-160 bcf of natural gas from US underground storage during the week ended Dec. 15. That compares with withdrawals of 116 bcf during the same period last year and 85 bcf in 1998.
Consequently, he said, �The year-over-year storage deficit should widen to over 625 bcf, or nearly 23% below last year, 6 weeks into the traditional withdrawal season.�
In London, North Sea Brent oil futures pushed through the $26/bbl level on the strength of severe US weather. Analysts said any significant bullish news was seized upon as justification to get more volatility into that previously bearish market.
The February contract for Brent oil closed at $26.24/bbl on the International Petroleum Exchange, up 35� for the day after trading as high as $26.84/bbl.
The January natural gas contract lost 19� to the equivalent of $4.16/Mcf on the IPE.
The average price of the Organization of Petroleum Exporting Countries� basket of seven crudes jumped $1.46 to $24.38/bbl on Monday.