MARKET WATCH: Oil prices rise as Iran talks stall
Oil futures climbed on the New York and London markets Nov. 11 after talks stalled between Iran and Western leaders about Iran’s nuclear program. Brent crude rebounded as well Nov. 11 after these same talks stalled.
Negotiators failed to finalize a first-stage agreement to curb Iran’s nuclear program, saying talks are scheduled to resume Nov. 20. An agreement to curb the nuclear program could change the status of oil export sanctions against Iran.
Iran currently faces crude oil sanctions from the United Nations, US, European Union, and others. The US Energy Information Administration estimates Iran’s average oil and condensate exports fell to 1.53 million b/d in 2012 compared with 2.51 million b/d in 2011.
US reformulated gasoline futures escalated, which analysts attributed to a Bloomberg News report that Phillips 66’s Bayway, NJ, refinery is weeks behind schedule on its seasonal maintenance. Phillips 66 declined to comment about the timing of maintenance work or to discuss specific units involved.
Regarding European refinery runs, Barclays Capital Inc. noted what it calls “a lackluster appetite for crude among European refineries,” because of weak downstream profit margins and increasing product imports into Europe from the US.
US refineries have access to cheaper crude than do European refineries, Barclays said in a research note about Brent prices being higher than US light sweet crude prices.
“Relatively tepid fundamentals [exist] globally at present, with refineries in Asia slowly throttling up their utilization rates, but remaining in a relaxed state with regards to their purchasing decisions,” said analyst Miswin Mahesh in Barclay’s London office.
Energy prices
The New York Mercantile Exchange December crude contract gained 54¢ on Nov. 11, settling at $95.14/bbl. The January 2014 contract increased 52¢ to $95.47/bbl.
Heating oil for December delivery added 1.9¢ to settle at a rounded $2.89/gal on NYMEX. Reformulated gasoline stock for oxygenate blending for December delivery rose 4.3¢ to a rounded $2.60/gal.
The December natural gas contract on NYMEX was up 1.5¢ to settle at a rounded $3.57/MMbtu. On the US spot market, the gas price at Henry Hub, La., was a rounded $3.62/MMbtu, an 8.2¢ gain.
In London, the December ICE contract for Brent crude oil jumped $1.28 to settle at $106.40/bbl. The January 2014 contract rose $1.15 to $106.18/bbl. The November contract for ICE gas oil increased $10.25 to $903.25/tonne.
The Organization of Petroleum Exporting Countries reported its basket of 12 benchmark crudes was $103.39/bbl on Nov. 8, up $1.27 from the previous day.
Contact Paula Dittrick at [email protected].
About the Author
Paula Dittrick
Senior Staff Writer
Paula Dittrick has covered oil and gas from Houston for more than 20 years. Starting in May 2007, she developed a health, safety, and environment beat for Oil & Gas Journal. Dittrick is familiar with the industry’s financial aspects. She also monitors issues associated with carbon sequestration and renewable energy.
Dittrick joined OGJ in February 2001. Previously, she worked for Dow Jones and United Press International. She began writing about oil and gas as UPI’s West Texas bureau chief during the 1980s. She earned a Bachelor’s of Science degree in journalism from the University of Nebraska in 1974.