MARKET WATCH: NYMEX crude prices fall on higher oil inventory
Crude oil benchmark prices declined for a third consecutive day on the New York and London markets Oct. 31. Oil prices continued falling during early Nov. 1 trading.
Previously this year, oil prices had jumped more than 10% but analysts say oil demand growth could stall on an anticipated slowing global economy.
The US Energy Information Administration reported crude oil inventories, excluding the Strategic Petroleum Reserve, increased by 3.2 million bbl for the week ended Oct. 26.
The latest estimated total was 426 million bbl (OGJ Online, Oct. 31, 2018).
US oil production also rose. The Petroleum Status Report said oil production reached 11.2 million b/d for the week ended Oct. 26, up 300,000 b/d from the previous week.
US oil sanctions on Iran are to be fully implemented on Nov. 4. Analysts believe US sanctions are supporting oil prices. US officials have encouraged other countries to also stop buying Iranian crude exports.
“The realized loss of Iranian exports will become more evident by the beginning of next year,” given ships loaded in October will still be delivering their cargoes over the coming weeks, said Harry Tchilinguirian, BNP Paribas global head of commodity markets strategy.
In May, US President Donald Trump announced a US withdrawal from a 2015 international agreement to ease sanctions on Iran in return for curbs to the country’s nuclear program.
Energy prices
The December light, sweet crude contract on the New York Mercantile Exchange dropped 87¢ on Oct. 31 to $65.31/bbl. The January contract also fell 87¢ to settle at $65.44/bbl.
The NYMEX natural gas price for December was up 7¢ to a rounded $3.26/MMbtu.
Ultralow-sulfur diesel for November edged up less than a penny to a rounded $2.26/gal. The NYMEX reformulated gasoline blendstock for December fell 5¢ to a rounded $1.75/gal.
Brent crude oil for December was down 44¢ to $75.47/bbl on London’s International Commodity Exchange. The January contract dropped 91¢ to $75.04/bbl. The gas oil contract for November gained $7.50 on Oct. 31 to close at $709.25/tonne.
The Organization of Petroleum Exporting Countries’ basket of crudes average for Oct. 31 was unavailable.
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.