Market watch: Markets rise on Russia's signals about output cuts
Energy futures prices soared in trading Friday on the New York Mercantile Exchange. Analysts attributed the market's rise to indications about developments over the production cut issue between the Organization of Petroleum Exporting Countries and non-OPEC countries.
By the OGJ Online Staff
HOUSTON, Dec. 3 -- Energy futures prices soared in trading Friday on the New York Mercantile Exchange.
The January contract for light, sweet crude rose 82¢ to $19.44/bbl, while the February contract rose 70¢ to $19.64/bbl.
Refined petroleum products also closed higher, with December home heating oil rising by 1.29¢ to finish at 53.23¢/gal, while unleaded gasoline for the same month advanced by 1.43¢ to rest at 53.43¢/gal.
NYMEX natural gas for January delivery added 14¢ to end at $2.70/Mcf.
Analysts attributed the market's rise to indications about developments over the production cut issue between the Organization of Petroleum Exporting Countries and non-OPEC countries.
There were signs that Russia is moving toward making a significant production cut to satisfy OPEC's demand of a 500,000 b/d decrease in output by non-OPEC countries, something OPEC wants before cutting its own production 1.5 million b/d on Jan. 1.
Although no definite comments were available in this regard, the analysts stressed that signs of an agreement were visible.
Meanwhile, in London Friday, North Sea Brent crude oil futures crept back above $19/bbl in late trading on the International Petroleum Exchange, in a largely technical correction, after futures dropped below $18 earlier in the week.
Brokers said there remained some hope that OPEC and non-OPEC producers may forge a compromise agreement on production cuts.
But the overall trend remained depressed and far more crude and products were being produced than demand justified, they noted.
On Friday, IPE January Brent futures settled at $19.14/bbl, up by 73¢ from the previous close. The day's high was $19.18 and the low $17.98.
Also on the IPE, the January natural gas contract fell 10¢ to the equivalent of $3.71/Mcf.
The OPEC basket of seven crudes stood at $17.45/bbl Friday, compared with $17.35 the previous day.
So far this year, the basket has averaged $23.59/bbl. For 2000 as a whole, the price of the basket averaged $27.60.