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.
Sunday, February 5, 2012
Wednesday, February 1, 2012
Oil Futures Fall a 5th Day as U.S. Stockpiles Rise
Oil traded near the lowest in six weeks as U.S. crude stockpiles increased more than estimated and gasoline use fell to a 10-year low. Brent crude in London was at the biggest premium to New York prices in 12 weeks.
Futures fluctuated today after declining as much as 0.6 percent in early trading. They settled yesterday at the lowest price in six weeks after an Energy Department report showed crude supplies in the U.S. rose by 4.2 million barrels last week. Inventories were projected to increase 2.6 million barrels, according to a Bloomberg News survey.
“Oil appears to be driven by U.S. domestic factors, the larger-than-expected increase in crude stockpiles and the fall in gasoline demand,” said Ric Spooner, chief analyst at CMC Markets in Sydney. “In the short-term, it flies in the face of the run of reasonably positive data from the U.S.”
Crude for March delivery was at $97.40 a barrel, down 21 cents, in electronic trading on the New York Mercantile Exchange at 12:55 p.m. Singapore time. The contract fell 0.9 percent yesterday to $97.61 a barrel, the lowest since Dec. 20. Prices are down 1.4 percent this year.
Brent oil for March settlement gained 23 cents, or 0.2 percent, to $111.79 a barrel on the London-based ICE Futures Europe exchange. It rose 58 cents yesterday to $111.56, the highest close since Jan. 11. The European benchmark contract’s premium to West Texas Intermediate futures was at $14.39, the widest since Nov. 11. That compares with a record spread of $27.88 on Oct. 14.
North Sea Oil
Brent’s premium to U.S. crude reflects unrest in Nigeria, Africa’s top oil producer. Nigerian security forces arrested the alleged spokesman of a militant Islamist group blamed for bombings and gun attacks that killed hundreds this year, the State Security Service said yesterday.
“Given the concerns in Nigeria, we can anticipate the potential for this spread to retract lost ground and see it heading back to $15 a barrel,” said Jonathan Barratt, chief executive officer of Barratt’s Bulletin in Sydney.
More North Sea oil is being shipped to Asia than at any time in the past eight years as prices fall to the lowest levels in 15 months compared with Middle East alternatives, according to shipping data.
Companies led by BP Plc and Vitol Group have sent at least 8 million barrels of North Sea oil to Asian ports since mid- December, equivalent to six days of U.K. production, according to ship-tracking data from AISLive Ltd. That’s the most for any month since 2004, data from Galbraith’s Ltd., a London-based shipbroker, show.
Fuel Supplies
In the U.S., gasoline consumption decreased to 7.97 million barrels a day, the lowest since September 2001, according to Energy Department data. Stockpiles of the fuel increased 3.02 million barrels last week, the report showed. They were projected to rise 500,000 barrels, according to the median of 12 analyst estimates in the Bloomberg News survey.
Distillate inventories, a category that includes heating oil and diesel, dropped by 135,000 barrels, the U.S. report showed. They were estimated to decline 1.38 million barrels, according to the survey.
Oil initially climbed yesterday in New York after data from the Institute for Supply Management showed manufacturing in the U.S. grew in January at the fastest pace in seven months. The Tempe, Arizona-based group’s manufacturing index rose to 54.1 from 53.1 in December. The median forecast of economists surveyed by Bloomberg News was 54.5.
‘Mixed Bag’
“Oil futures were a mixed bag, despite being encouraged by the unexpected rise in global manufacturing activity early in the session,” Mark Pervan, head of commodity research at Australia & New Zealand Banking Group Ltd. in Melbourne, said in a note today. The inventory data “showed a substantially larger than expected increase in crude stocks.”
The United Steelworkers union and Royal Dutch Shell Plc averted a potential strike earlier this week that would have idled as many as 69 refineries by tentatively agreeing to a new three-year contract.
The proposal includes pay increases of 2.5 percent in the first year and 3 percent in the second and third years, along with some of the improvements in safety language sought by the union, according to three labor representatives with direct knowledge of the negotiations.
Slowdown in China
In China, net crude-oil imports may grow at the smallest pace in at least six years in 2012 as the world’s second-biggest economy slows, estimates released by state-owned China National Petroleum Corp. show.
China, the world’s second-largest oil user, may raise retail fuel prices for the first time since April following gains in the crude grades the government tracks.
The moving average of Brent, Dubai and Indonesia’s Cinta crudes, the three types in the country’s pricing basket, over the past 22 working days climbed 4.3 percent as of yesterday, according to C1 Energy, a commodity researcher based in Shanghai. That’s above the 4 percent target that could trigger a fuel adjustment by the National Development and Reform Commission, China’s top economic regulator.
Source.
Futures fluctuated today after declining as much as 0.6 percent in early trading. They settled yesterday at the lowest price in six weeks after an Energy Department report showed crude supplies in the U.S. rose by 4.2 million barrels last week. Inventories were projected to increase 2.6 million barrels, according to a Bloomberg News survey.
“Oil appears to be driven by U.S. domestic factors, the larger-than-expected increase in crude stockpiles and the fall in gasoline demand,” said Ric Spooner, chief analyst at CMC Markets in Sydney. “In the short-term, it flies in the face of the run of reasonably positive data from the U.S.”
Crude for March delivery was at $97.40 a barrel, down 21 cents, in electronic trading on the New York Mercantile Exchange at 12:55 p.m. Singapore time. The contract fell 0.9 percent yesterday to $97.61 a barrel, the lowest since Dec. 20. Prices are down 1.4 percent this year.
Brent oil for March settlement gained 23 cents, or 0.2 percent, to $111.79 a barrel on the London-based ICE Futures Europe exchange. It rose 58 cents yesterday to $111.56, the highest close since Jan. 11. The European benchmark contract’s premium to West Texas Intermediate futures was at $14.39, the widest since Nov. 11. That compares with a record spread of $27.88 on Oct. 14.
North Sea Oil
Brent’s premium to U.S. crude reflects unrest in Nigeria, Africa’s top oil producer. Nigerian security forces arrested the alleged spokesman of a militant Islamist group blamed for bombings and gun attacks that killed hundreds this year, the State Security Service said yesterday.
“Given the concerns in Nigeria, we can anticipate the potential for this spread to retract lost ground and see it heading back to $15 a barrel,” said Jonathan Barratt, chief executive officer of Barratt’s Bulletin in Sydney.
More North Sea oil is being shipped to Asia than at any time in the past eight years as prices fall to the lowest levels in 15 months compared with Middle East alternatives, according to shipping data.
Companies led by BP Plc and Vitol Group have sent at least 8 million barrels of North Sea oil to Asian ports since mid- December, equivalent to six days of U.K. production, according to ship-tracking data from AISLive Ltd. That’s the most for any month since 2004, data from Galbraith’s Ltd., a London-based shipbroker, show.
Fuel Supplies
In the U.S., gasoline consumption decreased to 7.97 million barrels a day, the lowest since September 2001, according to Energy Department data. Stockpiles of the fuel increased 3.02 million barrels last week, the report showed. They were projected to rise 500,000 barrels, according to the median of 12 analyst estimates in the Bloomberg News survey.
Distillate inventories, a category that includes heating oil and diesel, dropped by 135,000 barrels, the U.S. report showed. They were estimated to decline 1.38 million barrels, according to the survey.
Oil initially climbed yesterday in New York after data from the Institute for Supply Management showed manufacturing in the U.S. grew in January at the fastest pace in seven months. The Tempe, Arizona-based group’s manufacturing index rose to 54.1 from 53.1 in December. The median forecast of economists surveyed by Bloomberg News was 54.5.
‘Mixed Bag’
“Oil futures were a mixed bag, despite being encouraged by the unexpected rise in global manufacturing activity early in the session,” Mark Pervan, head of commodity research at Australia & New Zealand Banking Group Ltd. in Melbourne, said in a note today. The inventory data “showed a substantially larger than expected increase in crude stocks.”
The United Steelworkers union and Royal Dutch Shell Plc averted a potential strike earlier this week that would have idled as many as 69 refineries by tentatively agreeing to a new three-year contract.
The proposal includes pay increases of 2.5 percent in the first year and 3 percent in the second and third years, along with some of the improvements in safety language sought by the union, according to three labor representatives with direct knowledge of the negotiations.
Slowdown in China
In China, net crude-oil imports may grow at the smallest pace in at least six years in 2012 as the world’s second-biggest economy slows, estimates released by state-owned China National Petroleum Corp. show.
China, the world’s second-largest oil user, may raise retail fuel prices for the first time since April following gains in the crude grades the government tracks.
The moving average of Brent, Dubai and Indonesia’s Cinta crudes, the three types in the country’s pricing basket, over the past 22 working days climbed 4.3 percent as of yesterday, according to C1 Energy, a commodity researcher based in Shanghai. That’s above the 4 percent target that could trigger a fuel adjustment by the National Development and Reform Commission, China’s top economic regulator.
Source.
Tuesday, January 31, 2012
Oil prices rise EU fiscal deal, Iran tensions
Oil prices rose today due to developing news on Europe's fiscal problems.
Demand for crude futures in London and New York received more support after German Chancellor Merkel urged China to reduce its dependence on Iranian oil.
Meanwhile, traders feared Iran could cut off oil and crude supplies to Europe and other major customers. OPEC added fuel to the fire stating that the tensions between Iran and the West could reduce investments in the oil and gas sector.
In an interview with the Dow Jones Newswires, Secretary General of OPEN Abdalla Salem el-Badri said the situation could hurt the economy if it led to a sharp hike in oil prices.
Prices of US light, sweet crude, Brent crude listed on the original article here.
Demand for crude futures in London and New York received more support after German Chancellor Merkel urged China to reduce its dependence on Iranian oil.
Meanwhile, traders feared Iran could cut off oil and crude supplies to Europe and other major customers. OPEC added fuel to the fire stating that the tensions between Iran and the West could reduce investments in the oil and gas sector.
In an interview with the Dow Jones Newswires, Secretary General of OPEN Abdalla Salem el-Badri said the situation could hurt the economy if it led to a sharp hike in oil prices.
Prices of US light, sweet crude, Brent crude listed on the original article here.
Tuesday, September 13, 2011
Gas Price still high
Gas prices continue to fluctuate even though experts predicted that by mid-September, the national average would be around $3.35 for a gallon of regular gasoline. Today's gasoline prices are at an average $3.65 which is more expensive than it was a month ago, and nearly $1 per gallon higher than this time last year.
Analysts attributed the price shifts to the combined forces of a chaotic situation in Libya and the recent lashing of Hurricane Irene, followed by Labor Day weekend, when gas prices always seem to rise a bit.
More on this from this link.
Analysts attributed the price shifts to the combined forces of a chaotic situation in Libya and the recent lashing of Hurricane Irene, followed by Labor Day weekend, when gas prices always seem to rise a bit.
More on this from this link.
Thursday, August 11, 2011
Crude down in Asian trade
SINGAPORE– Oil tumbled in Asian trade Friday due to a stronger dollar as global financial markets remained on edge on worries over the struggling US economy and the European debt crisis.
Analysts said prices are expected to be volatile, mirroring developments in the financial markets and the global economy.
New York’s main contract, West Texas Intermediate light sweet crude for delivery in September, fell 47 cents to $85.25 per barrel.
Brent North Sea crude for September delivery dipped 57 cents to $107.45.
“The US dollar has strengthened and that puts some downward pressure on oil, but this is part of the volatility of the markets,” said Victor Shum, an analyst with Purvin and Gertz energy consultancy in Singapore.
A stronger dollar makes dollar-priced oil more expensive, leading to softer demand and pushing prices lower.
Shum added that oil price movements will largely be “depending on headlines”, referring to news that can influence investors’ behaviour.
Crude prices fluctuated sharply in US trade on Thursday before following stock markets higher as bargain hunting and less bearish economic outlooks took hold in the markets.
“Growth concerns have pinned back oil prices at six-month lows, but current market turmoil distracts from supportive market fundamentals,” said Lawrence Eagles of JPMorgan Chase.
“However, with future economic growth becoming a central concern, we consider the implications for demand and supply if growth downgrades continue and what lessons, if any, the recession of 2008 provides,” he said in a client note.
Source.
Analysts said prices are expected to be volatile, mirroring developments in the financial markets and the global economy.
New York’s main contract, West Texas Intermediate light sweet crude for delivery in September, fell 47 cents to $85.25 per barrel.
Brent North Sea crude for September delivery dipped 57 cents to $107.45.
“The US dollar has strengthened and that puts some downward pressure on oil, but this is part of the volatility of the markets,” said Victor Shum, an analyst with Purvin and Gertz energy consultancy in Singapore.
A stronger dollar makes dollar-priced oil more expensive, leading to softer demand and pushing prices lower.
Shum added that oil price movements will largely be “depending on headlines”, referring to news that can influence investors’ behaviour.
Crude prices fluctuated sharply in US trade on Thursday before following stock markets higher as bargain hunting and less bearish economic outlooks took hold in the markets.
“Growth concerns have pinned back oil prices at six-month lows, but current market turmoil distracts from supportive market fundamentals,” said Lawrence Eagles of JPMorgan Chase.
“However, with future economic growth becoming a central concern, we consider the implications for demand and supply if growth downgrades continue and what lessons, if any, the recession of 2008 provides,” he said in a client note.
Source.
Oil Prices Back on Track to Rise After Def Pledges Low Rate to 2013
On Wednesday, the steep fall in oil prices came to an end after the U.S. Federal Reserve promised to extend near-zero interest rates for two more years.
On Tuesday, oil prices tumbled below $79 per barrel to its lowest level since September 2010 on the New York Mercantile Exchange. This was before the Fed statement about interest rates surfaced. However, after the news came out investors took a sigh of relief and the broader U.S. equity market jumped almost 4 percent to close above 11,200 points.
In London, Brent crude was up 4.06 percent to $106.73 per barrel on the ICE Futures Exchange. The benchmark oil for September delivery number was up 3.24, or 4.09 percent, to $82.54 per barrel on Wednesday in electronic trading on the New York Mercantile Exchange.
A report showing an unexpected decline in U.S. crude supplies also helped push oil prices higher.
The American Petroleum Institute said late Tuesday that crude inventories fell to 5.2 million barrels last week while analysts surveyed by Platts, the energy information arm of McGraw-Hill Cos., had predicted an increase of 1.8 million barrels. Inventories of gasoline dropped 1.0 million barrels last week while distillates decreased 600,000 barrels, the API said.
However, some analysts have warned that prices could moderate later in the week as attention again focuses on the prospect of economic growth. "The impact of the Fed move will likely fade by week's end," MF Global analysts wrote in a note. "The Fed's move to keep rates depressed for so long is likely because the central bank realizes that growth will be tepid for some time to come. This scenario does not bode well for commodities, especially base metals and energy."
Analysts also expect crude to fall further as consumer demand falters amid muted economic growth in developed countries. "The global economic dynamics that set this sharp oil price decline into motion a few weeks ago remain very much intact and capable of forcing a price decline into the $70 to 75 zone," energy consultant Ritterbusch and Associates said in a report. "The main theme behind the oil trade of the past month remains one in which heightened economic uncertainties mainly related to Europe and the U.S. are bringing into clearer focus a significant downdraft in oil demand."
Just as oil prices started to move higher today, many of oil and gas company shares are also expected to trade heavily once the market opens Wednesday. Exxon Mobil Corp. (NYSE: XOM) shares were trading lower by 0.47 percent to $71.30 in pre-market trading today. ConocoPhillips last traded at $64.56, up 4.26 percent, and Chevron Corp. (NYSE: CVX) last traded at $93.40, up 3.49 percent, on Tuesday.
As oil prices move higher, the pressure on the U.S. dollar was seen on Wednesday. The dollar was trading lower against the euro at $1.4356 per euro, and 76.5250 yen for a dollar, lower by 0.93 percent.
The rebound in crude oil prices helped investors brush off a drop in July implied crude imports by China.
Source.
On Tuesday, oil prices tumbled below $79 per barrel to its lowest level since September 2010 on the New York Mercantile Exchange. This was before the Fed statement about interest rates surfaced. However, after the news came out investors took a sigh of relief and the broader U.S. equity market jumped almost 4 percent to close above 11,200 points.
In London, Brent crude was up 4.06 percent to $106.73 per barrel on the ICE Futures Exchange. The benchmark oil for September delivery number was up 3.24, or 4.09 percent, to $82.54 per barrel on Wednesday in electronic trading on the New York Mercantile Exchange.
A report showing an unexpected decline in U.S. crude supplies also helped push oil prices higher.
The American Petroleum Institute said late Tuesday that crude inventories fell to 5.2 million barrels last week while analysts surveyed by Platts, the energy information arm of McGraw-Hill Cos., had predicted an increase of 1.8 million barrels. Inventories of gasoline dropped 1.0 million barrels last week while distillates decreased 600,000 barrels, the API said.
However, some analysts have warned that prices could moderate later in the week as attention again focuses on the prospect of economic growth. "The impact of the Fed move will likely fade by week's end," MF Global analysts wrote in a note. "The Fed's move to keep rates depressed for so long is likely because the central bank realizes that growth will be tepid for some time to come. This scenario does not bode well for commodities, especially base metals and energy."
Analysts also expect crude to fall further as consumer demand falters amid muted economic growth in developed countries. "The global economic dynamics that set this sharp oil price decline into motion a few weeks ago remain very much intact and capable of forcing a price decline into the $70 to 75 zone," energy consultant Ritterbusch and Associates said in a report. "The main theme behind the oil trade of the past month remains one in which heightened economic uncertainties mainly related to Europe and the U.S. are bringing into clearer focus a significant downdraft in oil demand."
Just as oil prices started to move higher today, many of oil and gas company shares are also expected to trade heavily once the market opens Wednesday. Exxon Mobil Corp. (NYSE: XOM) shares were trading lower by 0.47 percent to $71.30 in pre-market trading today. ConocoPhillips last traded at $64.56, up 4.26 percent, and Chevron Corp. (NYSE: CVX) last traded at $93.40, up 3.49 percent, on Tuesday.
As oil prices move higher, the pressure on the U.S. dollar was seen on Wednesday. The dollar was trading lower against the euro at $1.4356 per euro, and 76.5250 yen for a dollar, lower by 0.93 percent.
The rebound in crude oil prices helped investors brush off a drop in July implied crude imports by China.
Source.
Wednesday, August 3, 2011
Crude up in Asia on bargain hunting
Oil prices were up in Asia on Thursday as investors hunted for bargains after crude markets plunged in late US trade, analysts said.
New York’s main contract, light sweet crude for delivery in September, added 53 cents to 92.46 per barrel.
Brent North Sea crude for September delivery gained 39 cents to $113.62.
Crude traders were capitalising on cheap crude after it fell to one-month lows in late US trade Wednesday, analysts said.
“I think it’s just a temporary relief rally because oil prices were quite battered yesterday,” said Serene Lim, oil and gas analyst for ANZ bank in Singapore.
Crude markets had been dragged south on Tuesday by weak jobs creation and service sector growth numbers from the United States, prompting fears of a slowdown in the world’s largest oil consumer.
The Institute for Supply Management’s index released Wednesday showed the giant US service sector growing at a snail’s pace in July, with non-manufacturing activity dropping to 52.7 last month, barely above the 50 no-growth level.
US private sector hiring also slowed in July, with payrolls firm ADP reporting a net 114,000 jobs created by private, non-farm businesses last month compared with 145,000 in June.
Source.
New York’s main contract, light sweet crude for delivery in September, added 53 cents to 92.46 per barrel.
Brent North Sea crude for September delivery gained 39 cents to $113.62.
Crude traders were capitalising on cheap crude after it fell to one-month lows in late US trade Wednesday, analysts said.
“I think it’s just a temporary relief rally because oil prices were quite battered yesterday,” said Serene Lim, oil and gas analyst for ANZ bank in Singapore.
Crude markets had been dragged south on Tuesday by weak jobs creation and service sector growth numbers from the United States, prompting fears of a slowdown in the world’s largest oil consumer.
The Institute for Supply Management’s index released Wednesday showed the giant US service sector growing at a snail’s pace in July, with non-manufacturing activity dropping to 52.7 last month, barely above the 50 no-growth level.
US private sector hiring also slowed in July, with payrolls firm ADP reporting a net 114,000 jobs created by private, non-farm businesses last month compared with 145,000 in June.
Source.
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