A surge in U.S. hiring lifted oil prices for the first time in a week. As more Americans commute to work and the economy picks up, demand for energy is expected to rise.
U.S. benchmark crude increased by $1.48 on Friday to end the week at $97.84 per barrel. It was the first time since Jan. 26 that the price of crude ended the day higher. Brent, used to price international varieties of crude, rose by $2.51 to finish at $114.58 per barrel.
Prices rose after the government reported that the U.S. economy added 243,000 jobs in January. That was the biggest increase since April of last year, when 251,000 jobs were created. The unemployment rate fell to 8.3 percent — the lowest in three years.
The positive U.S. jobs data added to evidence that the world's largest economy — and biggest user of gasoline — is growing stronger. Manufacturing grew in January at the fastest pace in seven months. Factory orders rose in December by 1.1 percent, driven higher by big increases in spending on industrial machinery and autos.
The U.S. economic reports suggest the, "economy is in recovery with fewer jobless claims, more people on payrolls, higher equities prices, brisk car sales, and high travel bookings," said Tom Kloza, publisher and chief oil analyst at Oil Price Information Service.
Oil prices had fallen 3 percent during the first four days of the week. They were pushed lower on reports that U.S. fuel demand continues to fall behind where it was last year. The 4-week average for gasoline demand is down 7.3 percent. Last year, American drivers used nearly 3 percent less gasoline than they did in 2010.
Friday's employment report led investors to believe that gasoline demand could eventually rebound. Gasoline futures, which gauge where traders think prices are headed, rose by 4.55 cents to end at $2.9144 per gallon.
At the pump, regular unleaded gasoline is already at the highest ever for this time of year, reflecting surging energy demand in other parts of the world like China. A gallon of gas cost an average of $3.467 — 17.9 cents more than a month ago and 35.1 cents more than a year ago, according to auto club AAA, Wright Express and Oil Price Information Service.
Prices are expected to rise in coming months as the economy improves and as refineries crank up production of more expensive warm-weather gasoline blends. Analysts say prices could reach $4 per gallon by the spring.
In other energy trading, heating oil added 6.15 cents to end at $3.1144 per gallon and natural gas fell by 5.5 cents to finish the week at $2.499 per 1,000 cubic feet.
Source.
Showing posts with label brent crude oil. Show all posts
Showing posts with label brent crude oil. Show all posts
Sunday, February 5, 2012
Thursday, May 26, 2011
Crude Rises to Highest in Two Weeks on U.S. Fuel Demand; SocGen Sees $106
Oil traded near a two-week high in New York on signs of increased U.S. fuel demand after a government report showed inventories of diesel and heating oil fell in the world’s biggest crude-consuming nation.
Futures reached their highest since May 11 today after the Energy Department said yesterday that U.S. distillate supplies declined 2.04 million barrels to 141.1 million last week, the lowest since April 2009. Fuel demand climbed 2.2 percent. Oil may rise to $106 a barrel in coming weeks as prices mirror an early-May pullback in 2010 that launched a rally in the rest of that year, Societe Generale SA said.
“People are optimistic about a recovery even though the economics suggest otherwise,” said Jonathan Barratt, managing director of Commodity Broking Services Pty in Sydney, who predicted oil will average $100 this year. “The fact that oil hasn’t broken through $95 on the downside is the key.”
Crude for July delivery on the New York Mercantile Exchange was at $101.22 a barrel at 9:14 a.m. London time, down 10 cents, after gaining as much as 58 cents to $101.90. Brent crude for July settlement was at $114.73 a barrel, down 23 cents, on the ICE Futures Europe exchange in London. The contract yesterday climbed $2.40, or 2.1 percent, to $114.93, the highest settlement since May 10.
China Power Shortages
“Distillates stole center stage from gasoline on worries about surging demand in China and India,” said Phil Flynn, vice president of research at PFGBest in Chicago.
China may face power shortages of 30 gigawatts this summer, the China Electricity Council said last month. The government suspended diesel exports to increase supplies for use in power generation.
U.S. distillate consumption was the highest since the week ended April 15, according to the Energy Department. Total fuel demand climbed 2.2 percent to 18.9 million barrels a day. Refineries operated at 86.3 percent of capacity, the most since Jan. 7.
Heating oil futures in New York climbed for a third day, gaining as much as 1.97 cents, or 0.7 percent, to $3 a gallon.
U.S. gasoline stockpiles increased 3.79 million barrels to 209.7 million, the biggest addition since February, according to the report. They were forecast to rise 450,000 barrels, according to the median of 14 analyst estimates in a Bloomberg News survey. Gasoline use dropped 0.3 percent to 9.03 million barrels a day.
Fibonacci Support
Crude oil supplies gained 616,000 barrels to 370.9 million. Stockpiles were forecast to decrease by 1.5 million barrels, according to the survey.
Oil in New York, heading for the first monthly decline since August, has rebounded from its Fibonacci support near $95 a barrel, a level based on weekly price swings over the past year, according to Stephanie Aymes, a cross-commodity technical analyst at Societe Generale. Crude will probably continue to trade “sideways” in coming weeks before climbing to $106, the next Fibonacci retracement level, she said.
Oil also gained after the Organization for Economic Cooperation and Development raised its forecast for U.S. growth this year. The economy will expand 2.6 percent, up from a November estimate of 2.2 percent, the organization said in its annual economic outlook published yesterday. The OECD maintained its forecasts for the world economy to expand 4.2 percent this year and 4.6 percent in 2012.
Schork Report
The dollar declined, making commodities more attractive as an investment. The Dollar Index, a measure of the greenback against six major currencies, fell as much as 0.6 percent today, the biggest decline since April 20.
The Bank of England may raise interest rates after its economy expanded in the first quarter, which may support oil prices, according to Stephen Schork, Villanova, Pennsylvania- based analyst at The Schork Group Inc.
“This would put pressure on the Bank of England to ramp up interest rates which would, in turn, increase the strength of sterling,” he said in today’s Schork Report. “A stronger sterling implies a weaker dollar, and a weaker dollar implies… that’s right, higher crude oil prices.”
Brent crude, the European benchmark contract, traded at a premium of $13.47 a barrel to U.S. futures, compared with $13.61 yesterday. The difference between front-month contracts in London and New York surged to a record $19.54 on Feb. 21. It averaged 76 cents last year.
Brent has advanced 22 percent this year as unrest in the Middle East and North Africa toppled leaders in Tunisia and Egypt and spread to Libya, Iran and Syria. Yemen’s President Ali Abdullah Saleh said fighting could drag the country into civil war and warned that those who seek to disrupt security would be met with force.
The Organization of Petroleum Exporting Countries will leave production quotas unchanged at its June 8 meeting in Vienna because there is enough oil to meet demand, Iraq’s Deputy Prime Minister Hussain al-Shahristani said yesterday.
Source.
Futures reached their highest since May 11 today after the Energy Department said yesterday that U.S. distillate supplies declined 2.04 million barrels to 141.1 million last week, the lowest since April 2009. Fuel demand climbed 2.2 percent. Oil may rise to $106 a barrel in coming weeks as prices mirror an early-May pullback in 2010 that launched a rally in the rest of that year, Societe Generale SA said.
“People are optimistic about a recovery even though the economics suggest otherwise,” said Jonathan Barratt, managing director of Commodity Broking Services Pty in Sydney, who predicted oil will average $100 this year. “The fact that oil hasn’t broken through $95 on the downside is the key.”
Crude for July delivery on the New York Mercantile Exchange was at $101.22 a barrel at 9:14 a.m. London time, down 10 cents, after gaining as much as 58 cents to $101.90. Brent crude for July settlement was at $114.73 a barrel, down 23 cents, on the ICE Futures Europe exchange in London. The contract yesterday climbed $2.40, or 2.1 percent, to $114.93, the highest settlement since May 10.
China Power Shortages
“Distillates stole center stage from gasoline on worries about surging demand in China and India,” said Phil Flynn, vice president of research at PFGBest in Chicago.
China may face power shortages of 30 gigawatts this summer, the China Electricity Council said last month. The government suspended diesel exports to increase supplies for use in power generation.
U.S. distillate consumption was the highest since the week ended April 15, according to the Energy Department. Total fuel demand climbed 2.2 percent to 18.9 million barrels a day. Refineries operated at 86.3 percent of capacity, the most since Jan. 7.
Heating oil futures in New York climbed for a third day, gaining as much as 1.97 cents, or 0.7 percent, to $3 a gallon.
U.S. gasoline stockpiles increased 3.79 million barrels to 209.7 million, the biggest addition since February, according to the report. They were forecast to rise 450,000 barrels, according to the median of 14 analyst estimates in a Bloomberg News survey. Gasoline use dropped 0.3 percent to 9.03 million barrels a day.
Fibonacci Support
Crude oil supplies gained 616,000 barrels to 370.9 million. Stockpiles were forecast to decrease by 1.5 million barrels, according to the survey.
Oil in New York, heading for the first monthly decline since August, has rebounded from its Fibonacci support near $95 a barrel, a level based on weekly price swings over the past year, according to Stephanie Aymes, a cross-commodity technical analyst at Societe Generale. Crude will probably continue to trade “sideways” in coming weeks before climbing to $106, the next Fibonacci retracement level, she said.
Oil also gained after the Organization for Economic Cooperation and Development raised its forecast for U.S. growth this year. The economy will expand 2.6 percent, up from a November estimate of 2.2 percent, the organization said in its annual economic outlook published yesterday. The OECD maintained its forecasts for the world economy to expand 4.2 percent this year and 4.6 percent in 2012.
Schork Report
The dollar declined, making commodities more attractive as an investment. The Dollar Index, a measure of the greenback against six major currencies, fell as much as 0.6 percent today, the biggest decline since April 20.
The Bank of England may raise interest rates after its economy expanded in the first quarter, which may support oil prices, according to Stephen Schork, Villanova, Pennsylvania- based analyst at The Schork Group Inc.
“This would put pressure on the Bank of England to ramp up interest rates which would, in turn, increase the strength of sterling,” he said in today’s Schork Report. “A stronger sterling implies a weaker dollar, and a weaker dollar implies… that’s right, higher crude oil prices.”
Brent crude, the European benchmark contract, traded at a premium of $13.47 a barrel to U.S. futures, compared with $13.61 yesterday. The difference between front-month contracts in London and New York surged to a record $19.54 on Feb. 21. It averaged 76 cents last year.
Brent has advanced 22 percent this year as unrest in the Middle East and North Africa toppled leaders in Tunisia and Egypt and spread to Libya, Iran and Syria. Yemen’s President Ali Abdullah Saleh said fighting could drag the country into civil war and warned that those who seek to disrupt security would be met with force.
The Organization of Petroleum Exporting Countries will leave production quotas unchanged at its June 8 meeting in Vienna because there is enough oil to meet demand, Iraq’s Deputy Prime Minister Hussain al-Shahristani said yesterday.
Source.
Tuesday, May 17, 2011
Oil prices fall in choppy trading
Oil prices slipped today in choppy trading as weak economic data fuelled concerns about demand that have contributed to crude's 15% decline so far in May.
The US dollar index seesawed with the euro and the greenback's weakness late helped oil pare losses, traders and brokers said.
Oil felt pressure from news that US housing starts and building permits fell in April and factory output slumped.
US gasoline futures slid sharply early, then pared losses after tumbling nearly 5% the previous session on the receding threat to refineries from flooding in the Mississippi River delta.
Brent crude for July delivery dropped 85 cents to settle at $US109.99 a barrel, bouncing after earlier falling as low as $US108.07.
US crude for June delivery slipped 46 cents to end at a 12-week low settlement of $US96.91 a barrel, having dropped as low as $US95.02 on the day that June crude options expired on the New York Mercantile Exchange.
Traders and analysts noted open interest concentrated on puts at the June crude option $US95 strike price.
US crude trading volumes were 10% above the 30-day average, more robust than Brent volumes that were about 4% below.
"With the housing numbers coming in soft and industrial production coming in (near) flat, there is some concern there will be a double dip in the housing slump and on a broader scale for the economy as a whole," said Rob Kurzatkowski, futures analyst with OptionsXpress in Chicago.
"We're seeing further liquidation on the precious metals, and that's offering some outside pressure on the oil market as well."
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Copper ended lower for the first time in four sessions as the weak US economic data weighed on the industrial metal. Weak US retail and corporate earnings and the dollar's early strength pressured gold..
Concerns about the European debt crisis also weighed on oil, as investors watched to see if peripheral economies such as Greece and Portugal will be able to meet their obligations.
The euro bounced and rose against the dollar in choppy trading, but remained vulnerable on concerns Greece might restructure its massive debt.
The dollar index, measuring it against a basket of currencies, edged lower late after earlier being bolstered by the yen's weakness.
A stronger dollar can pressure dollar-denominated oil prices by raising the price for consumers using other currencies and pulling investment from commodities to less risky markets.
US oil inventories
US crude, gasoline and heating oil futures turned higher in post-settlement trading after a report from the industry group American Petroleum Institute showed gasoline and total distillate stocks fell last week.
Crude stocks rose 2.7 million barrels, gasoline stocks fell 676,000 barrels and distillates dropped 2.8 million barrels, the API said.
Ahead of the API report, a Reuters survey of analysts had forecast US crude inventories would be up for the fourth straight week, but only by 1 million barrels.
Gasoline stocks were seen up 800,000 barrels and distillate stockpiles up only 700,000 barrels.
"The report on its face is neutral, but the product draws continue to impress, especially given the retail price point," said John Kilduff, partner at Again Capital LLC in New York.
Rising water levels on the Mississippi River looked less likely to hurt eight refineries in Louisiana after US Army engineers began opening flood gates, helping US gasoline futures settle lower today.
The gasoline crack spread, or profit margin for refiners, pulled back more than $US3 to just below $US26 a barrel, after pushing above $US40 on May 10.
US retail gasoline demand fell last week compared with a year ago, but was up versus the previous week, a report from MasterCard Advisors' said on Tuesday.
Source.
The US dollar index seesawed with the euro and the greenback's weakness late helped oil pare losses, traders and brokers said.
Oil felt pressure from news that US housing starts and building permits fell in April and factory output slumped.
US gasoline futures slid sharply early, then pared losses after tumbling nearly 5% the previous session on the receding threat to refineries from flooding in the Mississippi River delta.
Brent crude for July delivery dropped 85 cents to settle at $US109.99 a barrel, bouncing after earlier falling as low as $US108.07.
US crude for June delivery slipped 46 cents to end at a 12-week low settlement of $US96.91 a barrel, having dropped as low as $US95.02 on the day that June crude options expired on the New York Mercantile Exchange.
Traders and analysts noted open interest concentrated on puts at the June crude option $US95 strike price.
US crude trading volumes were 10% above the 30-day average, more robust than Brent volumes that were about 4% below.
"With the housing numbers coming in soft and industrial production coming in (near) flat, there is some concern there will be a double dip in the housing slump and on a broader scale for the economy as a whole," said Rob Kurzatkowski, futures analyst with OptionsXpress in Chicago.
"We're seeing further liquidation on the precious metals, and that's offering some outside pressure on the oil market as well."
Advertisement
Copper ended lower for the first time in four sessions as the weak US economic data weighed on the industrial metal. Weak US retail and corporate earnings and the dollar's early strength pressured gold..
Concerns about the European debt crisis also weighed on oil, as investors watched to see if peripheral economies such as Greece and Portugal will be able to meet their obligations.
The euro bounced and rose against the dollar in choppy trading, but remained vulnerable on concerns Greece might restructure its massive debt.
The dollar index, measuring it against a basket of currencies, edged lower late after earlier being bolstered by the yen's weakness.
A stronger dollar can pressure dollar-denominated oil prices by raising the price for consumers using other currencies and pulling investment from commodities to less risky markets.
US oil inventories
US crude, gasoline and heating oil futures turned higher in post-settlement trading after a report from the industry group American Petroleum Institute showed gasoline and total distillate stocks fell last week.
Crude stocks rose 2.7 million barrels, gasoline stocks fell 676,000 barrels and distillates dropped 2.8 million barrels, the API said.
Ahead of the API report, a Reuters survey of analysts had forecast US crude inventories would be up for the fourth straight week, but only by 1 million barrels.
Gasoline stocks were seen up 800,000 barrels and distillate stockpiles up only 700,000 barrels.
"The report on its face is neutral, but the product draws continue to impress, especially given the retail price point," said John Kilduff, partner at Again Capital LLC in New York.
Rising water levels on the Mississippi River looked less likely to hurt eight refineries in Louisiana after US Army engineers began opening flood gates, helping US gasoline futures settle lower today.
The gasoline crack spread, or profit margin for refiners, pulled back more than $US3 to just below $US26 a barrel, after pushing above $US40 on May 10.
US retail gasoline demand fell last week compared with a year ago, but was up versus the previous week, a report from MasterCard Advisors' said on Tuesday.
Source.
Sunday, May 15, 2011
Oil Drops on U.S. Economy, Greece; BofA’s Blanch Sees Demand Destruction
Oil dropped for the first day in three in New York after President Barack Obama said failure to raise the U.S. debt ceiling may unravel global finances and threaten growth in the world’s biggest crude consumer.
Futures slipped as much as 1.3 percent after Obama said the U.S. “could have a worse recession than we’ve already had,” according to a segment taped for CBS’s “Face the Nation” program. Prices also slid on concern Greece’s debt crisis may worsen, threatening Europe’s economic growth. Oil may drop in the second half of the year amid signs prices are causing demand to slow, said Francisco Blanch, head of Global Commodity Research, Bank of America Merrill Lynch.
“At the moment, anything seen to adversely impact growth in the U.S. gets factored into oil prices,” said Ben Westmore, a minerals and energy economist at National Australia Bank Ltd. in Melbourne, who predicted crude in New York will average $113 a barrel in the third quarter.
Crude for June delivery slid as much as $1.30 to $98.35 a barrel in electronic trading on the New York Mercantile Exchange and was at $98.79 at 1:06 p.m. Sydney time. The contract gained 2.5 percent last week, the biggest weekly gain since the period ending April 8. Prices are 41 percent higher the past year.
Brent oil for June settlement lost 44 cents, or 0.4 percent, to $113.39 a barrel on the London-based ICE Futures Europe exchange. The contract advanced 4.3 percent last week.
The U.S. administration will begin stimulating domestic crude production to blunt rising gasoline prices with measures including encouraging drilling in Alaska and giving oil companies more time to comply with safety regulations, Obama said in his weekly address.
Mississippi Flooding
Gasoline prices outpaced crude, dropping 0.6 percent in New York, as flooding from the Mississippi River threatened the second-largest U.S. oil refinery. Futures for June delivery lost 1.7 cents to $3.0572 a gallon today.
Louisiana opened four of the 25 gates at the Morganza floodway, allowing the Mississippi River to pour into the Atchafalaya River basin. Inside the threatened area are 2,264 oil or natural gas wells that each day produce 19,278 barrels of crude, about 10 percent of Louisiana’s onshore total, and 252.6 million cubic feet of gas, according to the state.
The Mississippi was threatening to reach to a flow rate of 1.62 million cubic feet per second unless water was diverted, putting in peril the levees at Baton Rouge, home to an estimated 229,000 people and industrial areas that include an Exxon Mobil Corp. refinery, the company’s second largest U.S. facility.
Louisiana Refineries
Alon USA Energy Inc.’s refinery in Krotz Springs is in a zone under a mandatory evacuation order, St. Landry’s Parish spokeswoman Francine Sias said. Alon spokesman Blake Lewis said the parish had granted the company an extension. A temporary levee is being constructed by employees to protect the 83,000- barrel-a-day refinery and 243 nearby homes.
Oil prices will head lower in the July-to-December period amid signs of demand destruction, Blanch said at a media briefing in Hong Kong today. Brent may trade at an average $122 a barrel in the second quarter and $94 in the fourth, he said.
The European benchmark has climbed 20 percent this year as unrest in the Middle East and North Africa toppled leaders in Tunisia and Egypt and spread to Libya, Algeria, Bahrain, Iran, Syria, Oman and Yemen.
Brent traded at a premium of $14.59 a barrel to U.S. futures, compared with $14.18 on May 13. The difference between front-month contracts in London and New York surged to a record $19.54 on Feb. 21. The spread averaged 76 cents last year.
Yemen’s Joint Meetings Party, a coalition of six opposition groups, says a plan to end the country’s political crisis is dead following a visit by the chief envoy of Arab Gulf states seeking to broker a deal.
Source.
Futures slipped as much as 1.3 percent after Obama said the U.S. “could have a worse recession than we’ve already had,” according to a segment taped for CBS’s “Face the Nation” program. Prices also slid on concern Greece’s debt crisis may worsen, threatening Europe’s economic growth. Oil may drop in the second half of the year amid signs prices are causing demand to slow, said Francisco Blanch, head of Global Commodity Research, Bank of America Merrill Lynch.
“At the moment, anything seen to adversely impact growth in the U.S. gets factored into oil prices,” said Ben Westmore, a minerals and energy economist at National Australia Bank Ltd. in Melbourne, who predicted crude in New York will average $113 a barrel in the third quarter.
Crude for June delivery slid as much as $1.30 to $98.35 a barrel in electronic trading on the New York Mercantile Exchange and was at $98.79 at 1:06 p.m. Sydney time. The contract gained 2.5 percent last week, the biggest weekly gain since the period ending April 8. Prices are 41 percent higher the past year.
Brent oil for June settlement lost 44 cents, or 0.4 percent, to $113.39 a barrel on the London-based ICE Futures Europe exchange. The contract advanced 4.3 percent last week.
The U.S. administration will begin stimulating domestic crude production to blunt rising gasoline prices with measures including encouraging drilling in Alaska and giving oil companies more time to comply with safety regulations, Obama said in his weekly address.
Mississippi Flooding
Gasoline prices outpaced crude, dropping 0.6 percent in New York, as flooding from the Mississippi River threatened the second-largest U.S. oil refinery. Futures for June delivery lost 1.7 cents to $3.0572 a gallon today.
Louisiana opened four of the 25 gates at the Morganza floodway, allowing the Mississippi River to pour into the Atchafalaya River basin. Inside the threatened area are 2,264 oil or natural gas wells that each day produce 19,278 barrels of crude, about 10 percent of Louisiana’s onshore total, and 252.6 million cubic feet of gas, according to the state.
The Mississippi was threatening to reach to a flow rate of 1.62 million cubic feet per second unless water was diverted, putting in peril the levees at Baton Rouge, home to an estimated 229,000 people and industrial areas that include an Exxon Mobil Corp. refinery, the company’s second largest U.S. facility.
Louisiana Refineries
Alon USA Energy Inc.’s refinery in Krotz Springs is in a zone under a mandatory evacuation order, St. Landry’s Parish spokeswoman Francine Sias said. Alon spokesman Blake Lewis said the parish had granted the company an extension. A temporary levee is being constructed by employees to protect the 83,000- barrel-a-day refinery and 243 nearby homes.
Oil prices will head lower in the July-to-December period amid signs of demand destruction, Blanch said at a media briefing in Hong Kong today. Brent may trade at an average $122 a barrel in the second quarter and $94 in the fourth, he said.
The European benchmark has climbed 20 percent this year as unrest in the Middle East and North Africa toppled leaders in Tunisia and Egypt and spread to Libya, Algeria, Bahrain, Iran, Syria, Oman and Yemen.
Brent traded at a premium of $14.59 a barrel to U.S. futures, compared with $14.18 on May 13. The difference between front-month contracts in London and New York surged to a record $19.54 on Feb. 21. The spread averaged 76 cents last year.
Yemen’s Joint Meetings Party, a coalition of six opposition groups, says a plan to end the country’s political crisis is dead following a visit by the chief envoy of Arab Gulf states seeking to broker a deal.
Source.
Wednesday, April 13, 2011
Crude Oil Plunges as Higher Prices Are Forecast to Curb Growth
Oil fell, capping the biggest two- day drop in almost 11 months, after the International Energy Agency and International Monetary Fund said that prices above $100 a barrel are starting to hurt the global economy and Goldman Sachs Group Inc. forecast a “substantial” correction.
Oil plunged 3.3 percent after the IEA reported signs of an oil-demand “slowdown” in its monthly Oil Market Report today. The IMF cut its growth forecasts yesterday for the U.S. and Japan, two of the top three oil-consuming countries. Brent oil may drop more than $15 to $105 a barrel, Goldman said in a note to clients today.
“Right now, we’re in free-fall range,” said Stephen Schork, president of the Schork Group Inc. in Villanova, Pennsylvania. “We have a market condition that was way overbought, so now its length is getting stomped out of the market. There could be a ways to go in this selloff.”
Crude oil for May delivery fell $3.67 to $106.25 a barrel on the New York Mercantile Exchange, the lowest settlement since March 30. Prices have tumbled 5.8 percent since April 8, the biggest two-day retreat since May 14 and 17, 2010. Futures have risen 26 percent in the past year.
Prices declined from the settlement after the American Petroleum Institute reported at 4:30 p.m. that U.S. crude-oil stockpiles rose 1.19 million barrels to 355.5 million. May oil was down $3.90, or 3.6 percent, to $106.02 a barrel in electronic trading at 4:33 p.m.
‘The Surest Remedy’
“There are real risks that a sustained $100-plus price environment will prove incompatible with the currently expected pace of economic recovery,” the Paris-based IEA said. “The surest remedy for high prices may ultimately prove to be high prices themselves.”
The U.S. today boosted its crude-oil price forecast for 2011 to an average $106.38 a barrel from $101.77 a barrel last month, according to the Energy Department’s Short-Term Energy Outlook. It left its global consumption forecast unchanged at 88.2 million barrels a day.
Yesterday, the Paris-based IEA said worldwide oil demand will rise by 1.4 million barrels, or 1.6 percent, this year to average 89.4 million a day. The forecast was unchanged from March.
The U.S., the world’s largest economy, will expand 2.8 percent this year, down from 2.9 percent last year and a 3 percent growth rate for 2011 forecast in January, the IMF said yesterday. It cut Japan’s 2011 growth forecast to 1.4 percent from 1.6 percent in a January forecast.
Confirming Suspicions
“Yesterday’s IMF statement that the U.S. and Japan economies are being hurt by higher energy prices confirmed everybody’s suspicions,” said Sarah Emerson, managing director of Energy Security Analysis Inc. in Wakefield, Massachusetts. “We’ll move back to the $104-$105 level where we’ve got some technical support.”
Brent oil for May settlement fell $3.06, or 2.5 percent, to end the session at $120.92 a barrel on the London-based ICE Futures Europe exchange.
The oil market will pull back toward a $105-a-barrel near- term target for Brent, David Greely in New York and Jeffrey Currie in London said in the Goldman report. They cited high inventories and spare production capacity.
“There’s fundamental support for the market, just at a lower level than prices had risen,” Greely, head of energy research at Goldman Sachs, said in a telephone interview. “There’s support longer term, particularly in 2012. Prices simply rose sooner than the physical market supports.”
U.S. crude oil stockpiles probably increased 1 million barrels last week, according to a survey of 16 analysts before an Energy Department report tomorrow.
Commodity Basket
Yesterday, oil tumbled from a 30-month high of $112.79 a barrel as Goldman Sachs ended a recommendation to buy a basket of commodities including crude oil, copper, cotton and platinum, saying the risks outweigh any further potential gain. The basket of raw materials was first recommended by Currie on Dec. 1. It had gained 25 percent since then.
“The Goldman thing is probably one of the bigger factors,” said Kyle Cooper, director of research for IAF Advisors in Houston. “A whole lot of the market is still dictated by money flow. You’ve got a situation where Goldman decided to take profits.”
The so-called CCCP basket had a 40 percent weighting in oil, 20 percent in copper, 10 percent in soybeans, 10 percent cotton and 20 percent platinum.
Japanese Nuclear Crisis
Oil also fell today after Japan’s Nuclear and Industrial Safety Agency raised the severity rating of its nuclear crisis at the Fukushima Dai-Ichi station to the highest level, matching the severity of the 1986 Chernobyl disaster and boosting concern that the crisis will curb Japanese demand.
The accident at the plant followed a record earthquake and tsunami on March 11.
“No matter how much oil people think they’re going to export to Japan to make up for the nuclear loss, we’re going to see that economy take a turn for the worse,” said Carl Larry, president of Oil Outlooks & Opinions LLC in Houston. “If Japan really starts to deteriorate, its biggest trade partner is China, and they’re going to feel it next.”
China is the second-biggest oil-consuming country.
Oil volume in electronic trading on the Nymex was 993,886 contracts as of 4:33 p.m. in New York. Volume totaled 747,902 contracts yesterday, 6.3 percent below the average of the past three months and the highest level since March 16. Open interest was 1.57 million contracts.
Source.
Oil plunged 3.3 percent after the IEA reported signs of an oil-demand “slowdown” in its monthly Oil Market Report today. The IMF cut its growth forecasts yesterday for the U.S. and Japan, two of the top three oil-consuming countries. Brent oil may drop more than $15 to $105 a barrel, Goldman said in a note to clients today.
“Right now, we’re in free-fall range,” said Stephen Schork, president of the Schork Group Inc. in Villanova, Pennsylvania. “We have a market condition that was way overbought, so now its length is getting stomped out of the market. There could be a ways to go in this selloff.”
Crude oil for May delivery fell $3.67 to $106.25 a barrel on the New York Mercantile Exchange, the lowest settlement since March 30. Prices have tumbled 5.8 percent since April 8, the biggest two-day retreat since May 14 and 17, 2010. Futures have risen 26 percent in the past year.
Prices declined from the settlement after the American Petroleum Institute reported at 4:30 p.m. that U.S. crude-oil stockpiles rose 1.19 million barrels to 355.5 million. May oil was down $3.90, or 3.6 percent, to $106.02 a barrel in electronic trading at 4:33 p.m.
‘The Surest Remedy’
“There are real risks that a sustained $100-plus price environment will prove incompatible with the currently expected pace of economic recovery,” the Paris-based IEA said. “The surest remedy for high prices may ultimately prove to be high prices themselves.”
The U.S. today boosted its crude-oil price forecast for 2011 to an average $106.38 a barrel from $101.77 a barrel last month, according to the Energy Department’s Short-Term Energy Outlook. It left its global consumption forecast unchanged at 88.2 million barrels a day.
Yesterday, the Paris-based IEA said worldwide oil demand will rise by 1.4 million barrels, or 1.6 percent, this year to average 89.4 million a day. The forecast was unchanged from March.
The U.S., the world’s largest economy, will expand 2.8 percent this year, down from 2.9 percent last year and a 3 percent growth rate for 2011 forecast in January, the IMF said yesterday. It cut Japan’s 2011 growth forecast to 1.4 percent from 1.6 percent in a January forecast.
Confirming Suspicions
“Yesterday’s IMF statement that the U.S. and Japan economies are being hurt by higher energy prices confirmed everybody’s suspicions,” said Sarah Emerson, managing director of Energy Security Analysis Inc. in Wakefield, Massachusetts. “We’ll move back to the $104-$105 level where we’ve got some technical support.”
Brent oil for May settlement fell $3.06, or 2.5 percent, to end the session at $120.92 a barrel on the London-based ICE Futures Europe exchange.
The oil market will pull back toward a $105-a-barrel near- term target for Brent, David Greely in New York and Jeffrey Currie in London said in the Goldman report. They cited high inventories and spare production capacity.
“There’s fundamental support for the market, just at a lower level than prices had risen,” Greely, head of energy research at Goldman Sachs, said in a telephone interview. “There’s support longer term, particularly in 2012. Prices simply rose sooner than the physical market supports.”
U.S. crude oil stockpiles probably increased 1 million barrels last week, according to a survey of 16 analysts before an Energy Department report tomorrow.
Commodity Basket
Yesterday, oil tumbled from a 30-month high of $112.79 a barrel as Goldman Sachs ended a recommendation to buy a basket of commodities including crude oil, copper, cotton and platinum, saying the risks outweigh any further potential gain. The basket of raw materials was first recommended by Currie on Dec. 1. It had gained 25 percent since then.
“The Goldman thing is probably one of the bigger factors,” said Kyle Cooper, director of research for IAF Advisors in Houston. “A whole lot of the market is still dictated by money flow. You’ve got a situation where Goldman decided to take profits.”
The so-called CCCP basket had a 40 percent weighting in oil, 20 percent in copper, 10 percent in soybeans, 10 percent cotton and 20 percent platinum.
Japanese Nuclear Crisis
Oil also fell today after Japan’s Nuclear and Industrial Safety Agency raised the severity rating of its nuclear crisis at the Fukushima Dai-Ichi station to the highest level, matching the severity of the 1986 Chernobyl disaster and boosting concern that the crisis will curb Japanese demand.
The accident at the plant followed a record earthquake and tsunami on March 11.
“No matter how much oil people think they’re going to export to Japan to make up for the nuclear loss, we’re going to see that economy take a turn for the worse,” said Carl Larry, president of Oil Outlooks & Opinions LLC in Houston. “If Japan really starts to deteriorate, its biggest trade partner is China, and they’re going to feel it next.”
China is the second-biggest oil-consuming country.
Oil volume in electronic trading on the Nymex was 993,886 contracts as of 4:33 p.m. in New York. Volume totaled 747,902 contracts yesterday, 6.3 percent below the average of the past three months and the highest level since March 16. Open interest was 1.57 million contracts.
Source.
Monday, April 4, 2011
Brent oil tops $120 a barrel on Libya unrest
NEW YORK—Oil prices surged to new heights Monday, with Brent crude topping $120 a barrel for the first time since August 22, 2008, as traders eyed a raging rebellion in oil-exporter Libya.
New York's main contract, light sweet crude for delivery in May, closed at $108.47 a barrel, a gain of 53 cents from Friday.
In London, Brent North Sea crude for May delivery leaped $2.36 to settle at $121.06, after topping at $121.29 just before the session close.
The market kept a focus on fighting that continued Monday in Libya between rebels and forces loyal to leader Moammar Gadhafi.
Rebel fighters made a new attempt to recapture Brega, advancing to the outskirts of the oil refinery town only to be forced back under artillery fire.
Before the crisis, Libya exported 1.3 million barrels a day of crude oil, more than 1.5 percent of global demand, in large part to Europe. Those exports have dwindled to a trickle amid the uprising.
That makes Brent crude futures, the European benchmark contract, more sensitive to the situation in Libya than the US market, where crude oil reserves are abundant.
"The longer these battles are going on, the more the market is realizing the supply is going to be offline," said Matt Smith of Summit Energy.
Unrest in other parts of the Arab world also contributed to the rise in oil prices, he said.
"Yemen is such a big threat at the moment because of the proximity" with Saudi Arabia, the biggest oil producer in the OPEC cartel, he said.
"Things in Bahrain have calmed down a little bit but any further unrest could press prices higher."
In Gabon, sub-Saharan Africa's fourth-largest oil producer, a strike by oil-sector employees had halted almost all oil production.
Gabon's oil daily output normally ranges from 220,000 to 240,000 barrels.
"It is not a lot of oil but given the current situation we can't afford any more outages, so all the barrels are important," Kilduff said.
Source.
New York's main contract, light sweet crude for delivery in May, closed at $108.47 a barrel, a gain of 53 cents from Friday.
In London, Brent North Sea crude for May delivery leaped $2.36 to settle at $121.06, after topping at $121.29 just before the session close.
The market kept a focus on fighting that continued Monday in Libya between rebels and forces loyal to leader Moammar Gadhafi.
Rebel fighters made a new attempt to recapture Brega, advancing to the outskirts of the oil refinery town only to be forced back under artillery fire.
Before the crisis, Libya exported 1.3 million barrels a day of crude oil, more than 1.5 percent of global demand, in large part to Europe. Those exports have dwindled to a trickle amid the uprising.
That makes Brent crude futures, the European benchmark contract, more sensitive to the situation in Libya than the US market, where crude oil reserves are abundant.
"The longer these battles are going on, the more the market is realizing the supply is going to be offline," said Matt Smith of Summit Energy.
Unrest in other parts of the Arab world also contributed to the rise in oil prices, he said.
"Yemen is such a big threat at the moment because of the proximity" with Saudi Arabia, the biggest oil producer in the OPEC cartel, he said.
"Things in Bahrain have calmed down a little bit but any further unrest could press prices higher."
In Gabon, sub-Saharan Africa's fourth-largest oil producer, a strike by oil-sector employees had halted almost all oil production.
Gabon's oil daily output normally ranges from 220,000 to 240,000 barrels.
"It is not a lot of oil but given the current situation we can't afford any more outages, so all the barrels are important," Kilduff said.
Source.
Tuesday, March 29, 2011
Crude Oil Trades Near One-Week Low in New York as Libyan Rebels Make Gains
Crude oil dropped to the lowest price in a week in New York as the advance of Libyan rebels against Muammar Qaddafi’s troops spurred hope that the conflict in Africa’s third-largest oil producer may end soon.
Futures fell as much as 1.2 percent after Libyan government troops prepared to block advancing rebels at Sirte, Qaddafi’s hometown. Crude extended losses after St. Louis Federal Reserve President James Bullard indicated that the Fed may tighten monetary policy soon, fanning speculation demand growth may falter in the U.S., the world’s biggest oil consumer.
“The fairly disappointing news hurt market sentiment for risk appetite and pushed crude oil prices lower,” said Myrto Sokou, a London-based research analyst at Sucden Financial Ltd.
Crude for May delivery on the New York Mercantile Exchange fell as much as $1.28 to $102.70 a barrel, the lowest price since March 22, and was at $103.28 at 1:34 p.m. London time. Brent crude for May settlement on the London-based ICE Futures Europe exchange was down 59 cents at $114.21 a barrel.
President Barack Obama yesterday defended his decision to involve U.S. forces in the war. Military intervention “stopped Qaddafi’s deadly advance” and helped prevent a massacre of civilians that would have “stained the conscience of the world,” Obama said in a speech at the National Defense University in Washington late yesterday.
U.S. Monetary Policy
The U.S. Federal Reserve may need to decide on when to tighten monetary policy before the outlook for the global economy clears up later this year, Bullard said today in Prague.
A reduction in the Fed’s asset-purchase, or “quantitative easing,” program may begin if the U.S. economy is strong and global uncertainties are resolved, he said. A cut in the $600 billion program could be “on the order of $100 billion,” Bullard told reporters today following a presentation at a banking conference in Prague.
The volume of futures contracts trading on the New York Mercantile Exchange declined to 433,173 on March 25, the lowest since Dec. 31, according to data compiled by Bloomberg. Oil rose 4.3 percent last week to $105.40 a barrel.
“As governments around the world continued to take actions in response to the recent events, the oil market took a wait- and-see approach,” David Greely and Jeffrey Currie, analysts at Goldman Sachs, said in a report dated yesterday.
Hedge Fund Positions
Lower trading volumes are accompanied by high speculative net-long positions. Hedge-fund managers and other large speculators, betting that prices will rise, increased their net- long positions in futures by 5.9 percent to 286,812 futures in the seven days ended March 22, according to Commodity Futures Trading Commission data.
“We are in a situation where the speculative long positions are at very high levels but market liquidity at very low levels. This makes for a clear liquidity risk,” Olivier Jakob, managing director of Geneva-based consultants Petro matrix, said in a research note.
Futures in New York have rallied 22 percent since anti- government protests began Feb. 15 in Libya. The market may see little room for further gains in the near future, according to Glen Ward, head of retail derivatives of London Capital Group.
“All these long positions have to be got out of at some stage, so it’s time for the market to have a correction,” Ward said. “What you have seen is basically profit-taking.”
Stockpiles of crude in the U.S., the world’s biggest oil consumer, probably gained for a fourth week as imports rose ahead of the peak gasoline demand season, a Bloomberg News survey showed. The Energy Department publishes its weekly inventory report tomorrow. The industry-funded American Petroleum Institute releases its supply data today.
Commercially held inventories climbed 2 million barrels in the week ended March 25, according to the median estimate of nine analysts surveyed. Supplies previously increased to 352.8 million, the highest since December, as imports reached a six- week high.
Source
Futures fell as much as 1.2 percent after Libyan government troops prepared to block advancing rebels at Sirte, Qaddafi’s hometown. Crude extended losses after St. Louis Federal Reserve President James Bullard indicated that the Fed may tighten monetary policy soon, fanning speculation demand growth may falter in the U.S., the world’s biggest oil consumer.
“The fairly disappointing news hurt market sentiment for risk appetite and pushed crude oil prices lower,” said Myrto Sokou, a London-based research analyst at Sucden Financial Ltd.
Crude for May delivery on the New York Mercantile Exchange fell as much as $1.28 to $102.70 a barrel, the lowest price since March 22, and was at $103.28 at 1:34 p.m. London time. Brent crude for May settlement on the London-based ICE Futures Europe exchange was down 59 cents at $114.21 a barrel.
President Barack Obama yesterday defended his decision to involve U.S. forces in the war. Military intervention “stopped Qaddafi’s deadly advance” and helped prevent a massacre of civilians that would have “stained the conscience of the world,” Obama said in a speech at the National Defense University in Washington late yesterday.
U.S. Monetary Policy
The U.S. Federal Reserve may need to decide on when to tighten monetary policy before the outlook for the global economy clears up later this year, Bullard said today in Prague.
A reduction in the Fed’s asset-purchase, or “quantitative easing,” program may begin if the U.S. economy is strong and global uncertainties are resolved, he said. A cut in the $600 billion program could be “on the order of $100 billion,” Bullard told reporters today following a presentation at a banking conference in Prague.
The volume of futures contracts trading on the New York Mercantile Exchange declined to 433,173 on March 25, the lowest since Dec. 31, according to data compiled by Bloomberg. Oil rose 4.3 percent last week to $105.40 a barrel.
“As governments around the world continued to take actions in response to the recent events, the oil market took a wait- and-see approach,” David Greely and Jeffrey Currie, analysts at Goldman Sachs, said in a report dated yesterday.
Hedge Fund Positions
Lower trading volumes are accompanied by high speculative net-long positions. Hedge-fund managers and other large speculators, betting that prices will rise, increased their net- long positions in futures by 5.9 percent to 286,812 futures in the seven days ended March 22, according to Commodity Futures Trading Commission data.
“We are in a situation where the speculative long positions are at very high levels but market liquidity at very low levels. This makes for a clear liquidity risk,” Olivier Jakob, managing director of Geneva-based consultants Petro matrix, said in a research note.
Futures in New York have rallied 22 percent since anti- government protests began Feb. 15 in Libya. The market may see little room for further gains in the near future, according to Glen Ward, head of retail derivatives of London Capital Group.
“All these long positions have to be got out of at some stage, so it’s time for the market to have a correction,” Ward said. “What you have seen is basically profit-taking.”
Stockpiles of crude in the U.S., the world’s biggest oil consumer, probably gained for a fourth week as imports rose ahead of the peak gasoline demand season, a Bloomberg News survey showed. The Energy Department publishes its weekly inventory report tomorrow. The industry-funded American Petroleum Institute releases its supply data today.
Commercially held inventories climbed 2 million barrels in the week ended March 25, according to the median estimate of nine analysts surveyed. Supplies previously increased to 352.8 million, the highest since December, as imports reached a six- week high.
Source
Monday, November 26, 2007
Oil prices edge higher after briefly surpassing US$99 a barrel on cold weather, weak US dollar
NEW YORK _ Oil prices edged up Monday after briefly surpassing $99 a barrel on signs of colder weather in the United States and Europe and worries about weakness of the U.S. dollar.
The Thanksgiving holiday on Thursday marked the unofficial start of winter in the United States. Among other areas, southeastern New Mexico got up to 22.86 centimetres of snow and experienced colder than normal temperatures over the holiday weekend. Snow also fell in Germany over the weekend.
“The onset of cold U.S. weather is going to boost fuel demand,‘‘ said Victor Shum, an energy analyst with Purvin & Gertz in Singapore.
Light, sweet crude for January delivery on the New York Mercantile Exchange added 13 cents to $98.31 a barrel in electronic trading by midafternoon in Europe, after reaching a high of $99.11 earlier Monday.
On Friday, the contract rose 89 cents to settle at a closing record of $98.18 a barrel.
January Brent crude fell six cents to $95.70 a barrel on the ICE Futures exchange.
Meanwhile, the dollar fell slightly against the euro on Monday as speculation continued that the American credit crisis will lead to another cut in U.S. interest rates.
“The weakened U.S. dollar remains at record low levels and so we‘ve got pricing trying to test $100 again,‘‘ Shum said.
Oil futures offer a hedge against a weak dollar, and oil futures bought and sold in dollars are more attractive to foreign investors when the U.S. currency is falling.
Nymex crude prices reached a trading record of $99.29 a barrel on Wednesday, and are within the range of inflation-adjusted highs set in early 1980. Depending on how the adjustment is calculated, $38 a barrel then would be worth $96 to $103 or more today.
“Almost anything could push prices higher from here and we have to expect to see a move to‘‘ $100 per barrel this week, said Peter Beutel, president of U.S. energy risk management firm Cameron Hanover, in a research note, listing a U.S. Federal Reserve interest rate cut, a weaker U.S. dollar, colder weather forecasts or “any petro-political problem‘‘ among the factors which could push oil prices to three digits.
“We have reached the point, though, where the inability to touch or break $100 this week would be seen as rather a spectacular failure,‘‘ Beutel wrote.
Shum said that data suggesting OPEC is increasing production more quickly than expected is likely to keep a temporary cap on crude oil prices.
Oil Movements, an oil tanker tracking firm based in Britain, reported that Organization of Petroleum Exporting Countries oil exports are likely to jump by an average of 720,000 barrels a day in the four weeks ended Dec. 8, more than the expected 500,000 barrels per day.
Crude oil prices rose 43 per cent between August and early November on falling domestic inventories, concerns about supply disruptions overseas and, many analysts argue, speculative buying. But recent forecasts have suggested high prices are cutting demand.
Nymex heating oil rose 1.08 cents to $2.7150 a gallon while gasoline prices gained 0.58 cent to $2.4728 a gallon. Natural gas futures rose 19.9 cents to $7.899 per 1,000 cubic feet.
Source
The Thanksgiving holiday on Thursday marked the unofficial start of winter in the United States. Among other areas, southeastern New Mexico got up to 22.86 centimetres of snow and experienced colder than normal temperatures over the holiday weekend. Snow also fell in Germany over the weekend.
“The onset of cold U.S. weather is going to boost fuel demand,‘‘ said Victor Shum, an energy analyst with Purvin & Gertz in Singapore.
Light, sweet crude for January delivery on the New York Mercantile Exchange added 13 cents to $98.31 a barrel in electronic trading by midafternoon in Europe, after reaching a high of $99.11 earlier Monday.
On Friday, the contract rose 89 cents to settle at a closing record of $98.18 a barrel.
January Brent crude fell six cents to $95.70 a barrel on the ICE Futures exchange.
Meanwhile, the dollar fell slightly against the euro on Monday as speculation continued that the American credit crisis will lead to another cut in U.S. interest rates.
“The weakened U.S. dollar remains at record low levels and so we‘ve got pricing trying to test $100 again,‘‘ Shum said.
Oil futures offer a hedge against a weak dollar, and oil futures bought and sold in dollars are more attractive to foreign investors when the U.S. currency is falling.
Nymex crude prices reached a trading record of $99.29 a barrel on Wednesday, and are within the range of inflation-adjusted highs set in early 1980. Depending on how the adjustment is calculated, $38 a barrel then would be worth $96 to $103 or more today.
“Almost anything could push prices higher from here and we have to expect to see a move to‘‘ $100 per barrel this week, said Peter Beutel, president of U.S. energy risk management firm Cameron Hanover, in a research note, listing a U.S. Federal Reserve interest rate cut, a weaker U.S. dollar, colder weather forecasts or “any petro-political problem‘‘ among the factors which could push oil prices to three digits.
“We have reached the point, though, where the inability to touch or break $100 this week would be seen as rather a spectacular failure,‘‘ Beutel wrote.
Shum said that data suggesting OPEC is increasing production more quickly than expected is likely to keep a temporary cap on crude oil prices.
Oil Movements, an oil tanker tracking firm based in Britain, reported that Organization of Petroleum Exporting Countries oil exports are likely to jump by an average of 720,000 barrels a day in the four weeks ended Dec. 8, more than the expected 500,000 barrels per day.
Crude oil prices rose 43 per cent between August and early November on falling domestic inventories, concerns about supply disruptions overseas and, many analysts argue, speculative buying. But recent forecasts have suggested high prices are cutting demand.
Nymex heating oil rose 1.08 cents to $2.7150 a gallon while gasoline prices gained 0.58 cent to $2.4728 a gallon. Natural gas futures rose 19.9 cents to $7.899 per 1,000 cubic feet.
Source
Monday, November 19, 2007
US crude oil futures end higher
NYMEX
US crude oil futures ended higher on Friday, on short-covering before expiry of the December contract, with a weakened dollar providing support.
Heating oil and gasoline futures racked up good gains with demand seen rising next week, with the US Thanksgiving holiday on Thursday.
On the New York Mercantile Exchange, December crude settled up $US1.67, or 1.8 per cent, at $US95.10 a barrel, after moving from $93.20 to $95.73. Players with short December positions covered to avoid having to make physical delivery.
US crude stocks rose last week, government data showed on Thursday, fuelling the sell-off. But storage at the Cushing, Oklahoma, delivery hub for NYMEX-traded oil remained at the three-year low of 13.4 million barrels, a supportive factor.
January crude settled up $US1.77, or 1.9 per cent, at $US93.84 a barrel, trading from $US91.81 to $US94.36.
NYMEX crude hit $98.62, a front-month record, on Nov. 7.
In London, January Brent crude ended up $1.39, or 1.5 per cent, at $91.62 a barrel, trading from $90 to $91.95.
LONDON METAL EXCHANGE
Copper touched a three-month low on Friday, hit by falling equity markets and worries about weakening demand before short-covering pushed prices into positive terrain ahead of the session's close.
Lead traded at levels last seen two months ago, led down by technical selling after falling below support at $3,450 a tonne.
Copper for delivery in three months on the London Metal Exchange fell as low as $6,785 per tonne, its lowest level since August 18, before prices recovered to close at $7,040.
Prices bounced ahead of the close on short-covering, traders said. Investors were buying back assets previously sold to close out short positions as many expected prices to fall further.
On Thursday, copper shed 3 per cent before closing at $6,920.
Three-months lead futures on the LME closed at $3,315 after touching $3,310, down 5.2 per cent. In the previous session, lead was indicated at $3,490/3,500.
Copper, used extensively in construction and wiring, had a brief boost on Wednesday when a big earthquake struck Chile, the world's top producer of the metal. Investors, afraid of a major supply disruption, raced to buy the metal.
Now, with damage to production thought to be limited, bearish sentiment, fanned by increasing risk aversion in global markets, worries over the health of the US economy and signs of weakening Chinese buying, is dominating the market.
US industrial production unexpectedly fell in October, recording its biggest decline since a matching drop in January, in a troubling sign for an economy already struggling under the weight of a housing downturn.
Data from the International Copper Study Group (ICSG) showed the copper market had a deficit of 258,000 tonnes between January and August this year, against a surplus of 38,000 tonnes in the same year-ago period.
Three-months tin closed at $17,400 against $17,375/17,400 on Thursday. It hit an all-time high of $17,575 earlier this week.
Three-months zinc was down at $2,525/2,530 from $2,590, aluminium was $20 lower at $2,550 and nickel was at $31,250 versus $31,700.
COMEX
US gold futures reversed early gains to finish a tad lower on Friday, capping an extremely volatile week as investors opted to lock in profits after initially hunting for bargains based on a weaker dollar and rising crude oil prices.
However, bullion dealers said the sharp fall in gold prices this week had not triggered a significant amount of physical buying.
Platinum futures also rebounded 2 per cent, after the world's biggest platinum producer slashed its output forecast for this year.
Most-active December gold on the COMEX division of the New York Mercantile Exchange trimmed initial gains but was settled down 30 cents at $787.00 an ounce. It traded between $785.60 and $798.40.
At mid-afternoon on Wall, spot gold was quoted at $784.80/785.50 an ounce, compared with $785.80/786.60 in New York Thursday afternoon. London bullion dealers fixed the afternoon spot reference price at $789.75.
COMEX December silver closed up 2.8 cents at $14.510 an ounce, trading between $14.365 and $14.745.
Spot silver was quoted at $14.44/14.49 an ounce, compared with $14.35/14.40 late Thursday in New York. London silver was fixed at $14.45.
Dealers said platinum benefited as Anglo Platinum, the world's biggest platinum producer, cut this year's output forecast to between 2.45 million and 2.5 million ounces of refined platinum from its previous forecast.
NYMEX January platinum ended up $27.80 or 2 per cent at $1,453.20 an ounce. Spot platinum was quoted at $1,446/1,451.
December palladium declined $5.10 or 1.4 per cent to close at $365.85 an ounce. Spot palladium was at $365/368.
Saturday, November 17, 2007
Rise in inventories sends oil price falling
U.S. crude oil stockpiles climbed 2.81 million barrels to 314.7 million last week, the first gain in four weeks, the Energy Department said. A 750,000 barrel decline was expected, according to a Bloomberg News survey. Imports rose to the highest level since the week that ended Aug. 17.
"The jump in imports was enough for refiners to increase runs and still leave additional barrels to build stocks," said Tim Evans, an analyst with Citigroup Global Markets in New York. "The rise in imports is evidence that the declines we saw in recent weeks were a function of inventory management, not a shortage of oil."
Crude oil for December delivery closed down 66 cents at $93.43 a barrel on the New York Mercantile Exchange. Futures climbed to $98.62 on Nov. 7, the highest intraday price since trading began in 1983. Prices are up 57 percent from a year ago.
Brent crude oil for December settlement fell $1.14 to $90.22 a barrel on the London-based ICE Futures Europe exchange. Brent reached $95.19 a barrel on Nov. 7, the highest point since trading began in 1988.
Imports of crude oil rose 8.6 percent to 10.5 million barrels in the week that ended Nov. 9, the report showed.
"The gain shouldn't have been a surprise because there was no way that imports were going to stay so low," said Brad Samples, commodity analyst for Summit Energy Services in Kentucky. "The premium of WTI over Brent and some West African grades is a strong incentive to send barrels to the U.S. This should continue to boost inventories."
Total implied fuel demand in the United States averaged 20.6 million barrels a day in the four weeks that ended Nov. 9, down 0.7 percent from a year earlier, the Energy Department report showed. The Energy Department measures shipments from refineries, pipelines and terminals to calculate fuel demand.
"Even if demand here were to fall 5 percent, we would still see global growth because of what's happening in India and China," said Adam Hewison, president of INO.com, a Web site that provides technical analysis and financial news.
Source
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