MARKET WATCH: NYMEX, Brent oil prices end week with a rebound

Light, sweet crude oil rebounded on the New York and London markets on Dec. 8, the day after US oil futures dropped to a 3-week low on a weekly government report that showed rising US crude production.

The US Energy Information Administration’s Weekly Petroleum Status Report estimated oil production for the week ended Dec. 1 at 9.7 million b/d, which was the highest since monthly statistics from the early 1970s.

An indicator of future oil production is the US rig count. The Baker Hughes rig count climbed for the fifth consecutive week with a 2-unit gain to 931 rigs working during the week ended Dec. 8 (OGJ Online, Dec. 8, 2017).

Both additional rigs targeting oil, bringing the total to 751 from a week ago. Gas-directed rigs remain unchanged from a week ago at 180.

Meanwhile, US natural gas futures fell toward the lowest level in 6 weeks on Dec. 7 following release of a weekly US government report on gas supplies that showed a surprise injection.

EIA reported underground gas storage levels across the Lower 48 states edged up 2 bcf for the week ended Dec. 1 compared with the previous week.

The Weekly Gas Storage Report estimated gas storage for the week ended Dec. 1 was 3.695 tcf, down 264 bcf from 1 year ago, and 36 bcf feet below the 5-year average, the government said.

Before the gas storage report was released, S&P Global Platts said analysts that it surveyed had expected a 1-bcf decline.

Energy prices

The January 2018 light, sweet crude contract on the New York Mercantile Exchange gained 67¢ on Dec. 8 to $57.36/bbl.

The NYMEX natural gas price for January edged up less than 1¢ to a rounded $2.77/MMbtu. The Henry Hub cash gas price was $2.75/MMbtu, down 6¢.

Heating oil for January rose 3¢ to a rounded $1.93/gal. The NYMEX reformulated gasoline blendstock for January increased 1.6¢ to a rounded $1.72/gal.

The Brent crude contract for February 2018 on London’s ICE gained $1.20 to $63.40/bbl.

The gas oil contract for December was $564.75/tonne, up $15.75.

OPEC’s basket of crudes was $61.03/bbl on Dec. 8, up 91¢.

Contact Paula Dittrick at paulad@ogjonline.com.