Market watch: Energy futures weaken on NYMEX

Energy futures prices weakened on the New York Mercantile Exchange Monday. The December contract for light, sweet crude fell 99¢ to close at $21.23/bbl.

Nov. 13, 2001

2 min read

By the OGJ Online Staff

HOUSTON, Nov. 13 -- Energy futures prices weakened on the New York Mercantile Exchange Monday.

The December contract for light, sweet crude fell 99¢ to close at $21.23/bbl. The January contract fell 93¢ to $21.53. In after-hours electronic access trading, the December position was fetching $21.25, while the January contract was getting $21.58.

Refined petroleum products also closed lower, with December home heating oil losing 2.58¢ to finish at 60.10¢/gal, while unleaded gasoline for the same month pulled back by 3.14¢ to end at 57.57¢/gal.

NYMEX natural gas for November delivery lost 19.2¢ to end at $2.733/Mcf.

Traders said a jetliner crash in New York Monday had dampened hopes of an early recovery of the airline industry in the wake of the Sept. 11 terrorist attacks. Whether the crash was accidental or caused by terrorist activity, brokers predicted public concern about air travel and resulting low demand for jet fuel.

In London Monday, North Sea Brent crude oil futures slumped by just about a dollar per barrel on the International Petroleum Exchange, again as a result of the air crash in New York.

Brokers said the incident was the biggest bearish factor of the day because it encouraged swift and aggressive selling of crude futures, in the expectation that falling demand would now drop even more steeply as fewer passengers dared to fly.

Analysts said that in light of a lower demand situation, the Organization of Petroleum Exporting Countries' ministerial conference in Vienna on Wednesday might lead to a higher production cut being decided.

They noted that the market was expecting a production cut in the range of 1 million b/d, but some indications from OPEC member states suggest the reduction could be in the 1.5 million b/d range.

In addition, Russia's gesture of agreeing to cut output by 30,000 b/d, when the organization had hoped for something more substantial, was interpreted by the market as disappointing.

On Monday, IPE December Brent futures settled at $20.39/bbl, down by 99¢ from the previous close. The day's high was $21.63 and the low was $19.85.

On a brighter note, the December IPE contract for natural gas rose 19¢ to close at the equivalent of $3.57/Mcf.

The OPEC basket of seven crudes stood at $19.11/bbl Monday, compared with $19.53 the previous Friday.