MARKET WATCH: Rumors of OPEC action boosts oil prices
Oil prices rebounded Apr. 18 with the front-month crude contract up 1.2% from its low for the year in the previous session on rumors ministers of the Organization of Petroleum Exporting Countries may call a special meeting in response to sinking markets.
Natural gas escalated 4.4% after the Energy Information Administration reported the injection of 31 bcf of natural gas into US underground storage in the week ended Apr. 12, less than Wall Street’s consensus for a 35 bcf gain. That increased working gas in storage to 1.704 tcf, down 794 bcf from a year ago and 74 bcf below the 5-year average (OGJ Online, Apr. 18, 2013).
The SIG Oil Exploration & Production Index and the Oil Service Index followed oil and gas price increases, up 6.5% and 2.7%, respectively. However, analysts in the Houston office of Raymond James & Associates Inc. reported the Standard & Poor’s 500 Index slipped 0.7% to its lowest closing in April.
“Oil markets finally enjoyed some sustained upside, with [crude] benchmarks performing relatively well,” said Marc Ground at Standard New York Securities Inc., the Standard Bank Group. “Both are now facing key technical resistance levels, $90/bbl and $100/bbl for West Texas Intermediate and Brent respectively.
Energy prices
The May contract for benchmark US light, sweet crudes regained $1.05 to $87.73/bbl Apr. 18 on the New York Mercantile Exchange. The June contract took back $1.03 to $88/bbl. On the US spot market, WTI at Cushing, Okla., was up $1.05 to $87.73/bbl.
Heating oil for May delivery rebound by 4.45¢ to $2.78/gal on NYMEX. Reformulated stock for oxygenate blending for the same month increased 2.65¢ to $2.76/gal.
The May natural gas contract escalated 18.7¢ to $4.40/MMbtu on NYMEX. On the US spot market, gas at Henry Hub, La., rose 1.2¢ to $4.25/MMbtu.
In London, the June IPE contract for North Sea Brent recovered $1.44 to $99.13/bbl. Gas oil for May advanced $3 to $828.25/tonne.
The average price for OPEC’s basket of 12 benchmark crudes dropped 36¢ to $96.35/bbl.
Contact Sam Fletcher at [email protected].
Sam Fletcher | Senior Writer
I'm third-generation blue-collar oil field worker, born in the great East Texas Field and completed high school in the Permian Basin of West Texas where I spent a couple of summers hustling jugs and loading shot holes on seismic crews. My family was oil field trash back when it was an insult instead of a brag on a bumper sticker. I enlisted in the US Army in 1961-1964 looking for a way out of a life of stoop-labor in the oil patch. I didn't succeed then, but a few years later when they passed a new GI Bill for Vietnam veterans, they backdated it to cover my period of enlistment and finally gave me the means to attend college. I'd wanted a career in journalism since my junior year in high school when I was editor of the school newspaper. I financed my college education with the GI bill, parttime work, and a few scholarships and earned a bachelor's degree and later a master's degree in mass communication at Texas Tech University. I worked some years on Texas daily newspapers and even taught journalism a couple of semesters at a junior college in San Antonio before joining the metropolitan Houston Post in 1973. In 1977 I became the energy reporter for the paper, primarily because I was the only writer who'd ever broke a sweat in sight of an oil rig. I covered the oil patch through its biggest boom in the 1970s, its worst depression in the 1980s, and its subsequent rise from the ashes as the industry reinvented itself yet again. When the Post folded in 1995, I made the switch to oil industry publications. At the start of the new century, I joined the Oil & Gas Journal, long the "Bible" of the oil industry. I've been writing about the oil and gas industry's successes and setbacks for a long time, and I've loved every minute of it.
