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Apr-27-2011Crude Oil Falls as US Supplies Climb the Most in Nine Months(topic overview)
CONTENTS:
- On the New York Mercantile Exchange, June crude CLM1 rose 24 cents, or 0.2 percent to $112.28 a barrel by 8:38 a.m. EDT (1238 GMT), trading from $111.12 to $112.60. (More...)
- Oil's price surge has created "new headwinds" against economic growth, Geithner said yesterday at the Council on Foreign Relations in New York. (More...)
- Reformulated gasoline blendstock, or RBOB, for May delivery settled up 1.43 cents, or 0.4%, to $3.3229 a gallon on the New York Mercantile Exchange, the highest settlement since July 2008. (More...)
- Italian oil and gas group Eni, reporting earnings on Wednesday, said production fell almost 9 percent in the first quarter because of unrest in Libya. (More...)
- "Moreover," Sen said, "current oil demand boasts of significantly altered global income and price elasticities. (More...)
- Members of the Organization of Petroleum Exporting Countries have not replaced oil production lost to the conflict in Libya, creating a 1 million b/d shortage last month. (More...)
- "People need to know that there are millions of barrels per day of spare capacity available," Falih said. (More...)
- The Federal Reserves FOMC begins first day of two-day meeting on monetary policy. (More...)
- U.S. refineries ran at 82.7 percent of total capacity on average, up 0.2 percentage point from the prior week. (More...)
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On the New York Mercantile Exchange, June crude CLM1 rose 24 cents, or 0.2 percent to $112.28 a barrel by 8:38 a.m. EDT (1238 GMT), trading from $111.12 to $112.60. Saudi Arabia is uneasy with high oil prices and concerned about their impact on the global economy, the chief executive of state oil firm Aramco said. [1] On the New York Mercantile Exchange, June crude CLM1 rose 21 cents, or 0.2 percent to $112.42 a barrel by 9:01 a.m. EDT (1301 GMT), trading from $111.71 to $112.79. NATO air strikes forced Libyan government forces to withdraw from one of their positions in the besieged city of Misrata overnight but they resumed bombardment of the port area on Wednesday, a rebel spokesman said. [2] Crude for June delivery was at $112.31 a barrel, up 10 cents, in electronic trading on the New York Mercantile Exchange at 10:34 a.m. Sydney time, after earlier dropping as much as 0.5 percent. [3] Crude oil for June delivery slipped 1 cent to settle at $112.28 a barrel on the New York Mercantile Exchange. [4] Oil for June delivery rose as much as 78 cents to $113.07 a barrel on the New York Mercantile Exchange. That's the highest intraday price since April 11, when futures reached $113.46, the most since September 2008. [5]
Cushing is the delivery point for the New York Mercantile Exchange's benchmark West Texas Intermediate crude futures contract. Industry group American Petroleum Institute, in its own weekly data report released on Tuesday, said domestic crude stocks rose 4.9 million barrels last week, with gasoline stocks down 2.1 million barrels and distillates up 1.5 million barrels. [6] Refinery utilization up 0.2 pct point at 82.7 pct NEW YORK, April 27 (Reuters) - U.S. crude oil stocks rose by more than 6 million barrels last week, propelled by more crude imports, according to a weekly report from the Energy Information Administration on Wednesday. [6] NEW YORK -- Crude oil supplies rose last week, while gasoline supplies dropped, the government said Wednesday. Crude supplies grew by 6.2 million barrels, or 1.7 percent, to 363.1 million barrels, which is 1.5 percent above year-ago levels, the Energy Department's Energy Information Administration said in its weekly report. [7]
An Energy Department report today may show supplies climbed 1.7 million barrels from 357 million, according to a Bloomberg News survey of analysts. Oil has advanced 23 percent in New York this year amid unrest in the Middle East and North Africa that has toppled leaders in Egypt and Tunisia and spread to Libya, Algeria, Bahrain, Iran, Oman, Syria and Yemen. [3] Most European countries have a public holiday today for Easter Monday. Reports that Saudi Arabia may boost its output capacity to 15 million barrels a day from 12.5 million barrels a day aren't true, the official said by telephone yesterday, declining to be identified by name because he isn't authorized to speak publicly. Oil has advanced 23 percent this year, stoked by turmoil in the Middle East and North Africa that has toppled leaders in Egypt and Tunisia and spread to Libya, Algeria, Bahrain, Iran, Oman, Syria and Yemen. [5]
Futures yesterday traded at $113.48 a barrel, the highest since Sept. 22, 2008. Saudi Arabia raised its crude output to offset lost production in Libya and has developed two new blends to help meet the demand of European refiners that use Libyan grades. Both countries are part of the 12-member Organization of Petroleum Exporting Countries, which supplies about 40 percent of the world's oil. Oil consumers needn't be concerned by high crude prices because spare capacity can "moderate" the market, said al- Falih, who is in South Korea for a board meeting this week. [8] Coming up: API oil inventory data, 4:30 p.m. EDT Tuesday NEW YORK, April 26 (Reuters) - U.S. crude futures edged up in seesaw trading on Tuesday as a key Federal Reserve two-day policy meeting starts and with the weak dollar lending support after earlier comments from a Saudi oil official pressured prices. [1] Coming up: EIA stocks data, 10:30 a.m. EDT, Wednesday (Recasts, updates prices, market activity) NEW YORK, April 26 (Reuters) - U.S. crude oil futures ended near flat for the second day in a row on Tuesday as investors held off making big bets as they await results of a two-day meeting of Federal Reserve policymakers, hoping for a clearer view of the economic outlook. [9] Coming up: EIA oil data, 10:30 a.m. EDT Wednesday NEW YORK, April 27 (Reuters) - U.S. crude futures edged up in choppy trading on Wednesday ahead of government oil inventory data and a Federal Reserve statement due after a two-day FOMCmeeting expected to leave a loose monetary policy. [2]
Brent oil for June settlement slipped 19 cents to $123.95 a barrel on the London-based ICE Futures Europe exchange. Crude oil also declined on speculation Federal Reserve officials will prepare to pull back from record stimulus by dropping a pledge this year to hold the main interest rate near zero for an "extended period," a Bloomberg News survey showed. Thirty-three of 44 economists surveyed said the central bank will remove the two-word phrase from its post-meeting statement in 2011, with 18 betting it will move by September. [10] The front-month Brent crude-oil futures contract, the London benchmark, eased from a 2-year high of $127 a barrel on April 11, amid concerns that surging prices are hurting demand. It settled at $123.66 a barrel on Monday, up 5.4% this month. The front-month June contract on the New York Mercantile Exchange eased one cent to $112.28, still up 5.2% this month and 23% this year. [11] New York's main futures contract, light sweet crude for June, was down 19 cents $US112.02 a barrel, while Brent North Sea crude for delivery in June eased 22 cents to $US123.92. [12]
On the New York Mercantile Exchange, light, sweet crude futures for delivery in June traded at $112.64 a barrel at 0600 GMT, up $0.35 in the Globex electronic session. [13] Oil for June delivery on the New York Mercantile Exchange was up 13 cents at $112.41 a barrel at 10:23 a.m. London time, after falling as much as 1 percent. [14] Oil for June delivery slipped 1 cent to settle at $112.28 a barrel on the New York Mercantile Exchange. [15]
Oil fell 61 cents to $111.60 per barrel in morning trading on the New York Mercantile Exchange. [7] Benchmark crude for June delivery was down $1.08 at $111.20 a barrel at midday Singapore time in electronic trading on the New York Mercantile Exchange. [16] Crude for June delivery on the New York Mercantile Exchange traded at $112.26 a barrel, up 6 cents, at 9:51 a.m. London time, after falling as much as 50 cents to $111.71 a barrel. [17]
Oil's price surge has created "new headwinds" against economic growth, Geithner said yesterday at the Council on Foreign Relations in New York. "What's happening in oil is obviously potentially very significant," he said. U.S. crude stockpiles rose 4.91 million barrels last week to 361 million, the biggest increase in four weeks and the second-largest this year, according to the American Petroleum Institute. [3] U.S. crude oil prices slumped this morning following the announcement of a larger-than-expected build in inventories. Stocks rose by 6.2 million barrels, according to data released by the U.S. Department of Energy this morning. [18] Late Tuesday, data from the API revealed that U.S. crude oil inventories moved up by 4.90 million barrels, while gasoline stocks dipped by 2.10 million barrels in the week ended April 22. [19] Analysts were expecting crude oil inventories pile up by only 1.60 million barrels, while gasoline stocks are seen dipping by 1.3 million barrels. This morning, the U.S. dollar continued to linger around its 15-month low versus the euro and sterling. [20] Tuesday after the markets closed, the API said U.S. crude oil inventories moved up by 4.90 million barrels, while gasoline stock piles decreased 2.10 million barrels in the week ended April 22. [20]
Analysts were expecting crude oil inventories to increase by only 1.50 million barrels and gasoline stocks to dip by 1.00 million barrels last week. [19]
Crude oil stocks rose by 6.156 million barrels in the week ended April 22, well-above the 900,000-barrel rise expected by analysts surveyed by Dow Jones Newswires. At 363.1 million barrels, stocks are at their highest. [21]
The U.S. Energy Information Administration in its weekly crude oil report said U.S. commercial crude oil inventories increased by 6.20 million barrels to 363.10 million barrels last week, and remain above the upper limit of the average range for this time of year. [19] U.S. crude stockpiles rose by 6.16 million barrels, the U.S. Energy Information Administration said in a weekly report at 1430 GMT, much more than expected, while supplies of gasoline and diesel fell. [22] Distillates, expected to rise, fell 1.81 million barrels. U.S. crude has risen more than 20 percent so far this year and consumers in the world's largest economy are starting to show signs of being hurt by higher fuel costs. President Obama on Tuesday urged producers to lift crude output as he sought to deflect public anger over high gasoline prices. [22]
Distillate fuel consumption now averages 3.8 million barrels per day, up 7.3 percent from year-ago levels. This week's 3.8 percent spike in crude oil prices put a crimp in refiners' margins. [18] U.S. crude oil imports during the week averaged just under 9.30 million barrels per day last week, up by 1.20 million barrels per day from the previous week, official data revealed. [19]
Crude fell 7 cents after Khalid al-Falih, chief executive officer of Saudi Arabian Oil Co., said the world'''s biggest crude exporter is committed to maintaining 3 million to 4 million barrels a day of spare capacity to stabilize the market. [23] SEOUL — Saudi Arabia's state oil giant Aramco will raise its refining capacity by 50 percent to above six million barrels a day by expanding at home and abroad, chief executive Khalid al Falih said. Work was progressing on two new refineries in the kingdom, he told a meeting in Seoul on Tuesday. [24] Saudi Arabia is committed to keeping aside a "sizable cushion" of 3 million to 4 million barrels a day of idle production capacity to stabilize the market, Khalid al-Falih, chief executive officer of Saudi Arabian Oil Co., said today in Seoul. [8]
The official explained that production averaged 9 million barrels a day that month because, "our output does change from one day to another." Other Saudi officials said prior to Mr. Al-Naimi's comments that production increased by between 500,000 and 600,000 barrels a day at the end of February in response to the Libyan crisis. The kingdom subsequently reduced output by 500,000 barrels a day in mid-March, officials said, but only because of lack of demand for their oil, which is unsuitable for regular refiners of Libyan crude. [25]
The minister said there is little interest in increased crude supply because of high prices, maintenance at refineries, and reduced demand from Japan due to the earthquake and tsunami. In late March, however, Kuwait's oil minister was quoted by the country's official news agency as saying many buyers were asking for additional crude. He said Kuwait would not exceed its output quota, despite spare production capacity of 1 million b/d. At that time, CGES analysts said, "This is the heart of the problem that the oil market faces at the moment. Buyers clearly want more oil from OPEC than it is currently producing, yet those with spare capacity seem to be doing very little." They projected the world will need 30.3 million b/d of oil from OPEC in the second quarter, "just to keep quarterly oil prices around $110/bbl" (OGJ Online, Mar. 21, 2011). [26] In London, analysts at the Centre for Global Energy Studies (CGES) said, "Oil prices are rising to levels that are beginning to affect demand, yet the world is being told once again that markets remain 'well-supplied' with crude and that the upward march of prices does 'not reflect the realities of supply and demand.'" They said OPEC members have not replaced oil production lost to the conflict in Libya, leaving a shortage of 1 million b/d in March (OGJ Online, Apr. 18, 2011). [26]
Iran and Saudi Arabia are old antagonists, and Iran is reported to be stirring up resentment among Shia Muslims against Sunni Muslims. Jakob said, "We believe there is a political side to the Saudi Arabia cut in oil production, and if they are trying to barter oil against support for the Bahraini military operation, then we are in a bit of trouble. Saudi Arabia seems today more focused on saving its political regime than saving the world economy." At the recent roundtable meeting, Al-Badri told reporters, "We see that there is a $15-20 premium risk at this time." That is a higher premium than market analysts have attributed to oil prices despite various supply disruptions in recent years from the sabotage of pipelines and other oil field structures in Iraq and Nigeria through recent political uprisings in the Middle East and North Africa, including the stalemated revolution that essentially stopped Libya's production. [26] Gen. Abdalla El-Badri said there is little that members can do to relieve prices that are buoyed more by speculation than by fundamentals of supply and demand. "The rise in oil prices during the past weeks mainly due to apprehensions about the global economy," El Badri said, adding that as a result of those concerns, speculators had added a $15-20/bbl risk premium to the price of crude. "The fact that OPEC has not revised its quotas reflects a conviction that the current demand-supply balance is close to correct," said Jarmo T. Kotilaine, chief economist at Saudi Arabia's National Commercial Bank, adding, "There is little in the current environment to give OPEC a compelling reason to significantly loosen its policy." [27] NYMEX May gasoline RBK1 settled at $3.3572 a gallon, up 3.43 cents or 1.03 percent, after trading from $3.30 to $3.3729. It was the highest close for front-month gasoline since July 15, 2008 settlement at $3.3848. U.S. President Barack Obama, acknowledging high gasoline prices could sap the U.S. economy, urged Congress to end tax breaks for oil and gas companies and called on Republicans to back his plan. The U.S. is in a better position than other advanced nations to manage its fiscal issues, Treasury Secretary Timothy Geithner said, noting entitlements were a smaller share of spending than was the case in other countries. U.S. consumers perked up a bit in April as they lowered their forecasts for inflation and worried less about the jobs market, but yet another fall in house prices underscored the challenges facing the recovery. Saudi Arabia is uneasy with high oil prices and concerned about their impact on the global economy, said Khalid al-Falih, chief executive of state oil firm Aramco. [9]
"On a relative value basis, the Brent premium to WTI did come off yesterday," Jakob said. That loss apparently was regained in overnight and early trading Apr. 26. "Gasoline continues to climb over heating oil as we approach the expiry of the May contract, its prompt backwardation increasing while heating oil remains with a large prompt contango. U.S. refineries will go into maximum gasoline yields mode, while demand will continue to face some headwind as U.S. average gasoline prices should average by the end of the week slightly above $3.90/gal," he said. In other news, Raymond James reported Holly Corp. shut down the crude unit at the west facility of its 125,000-b/d Tulsa refinery due to a mechanical failure. [28] While MENA turmoil lends background support to crude oil prices, Westgate said a "deterioration in the situation" apparently is necessary to stimulate response from a market now in a "wait and see" mode. That stimulus may come from an unprecedented press conference by Ben S. Bernanke, chairman of the Federal Reserve board of governors, at the Apr. 27 conclusion of a meeting of the Federal Open Market Committee, the Fed's policy-making arm, that begin today. Westgate also noted, "Saudi Arabia has indicated that it is uncomfortable with current high oil prices, suggesting fears over demand destruction and the impact of inflation are giving them cause for concern." Trading volume "was extremely low" Apr. 25 with both ICE Brent and West Texas Intermediate touching record low volumes during trading sessions, said Olivier Jakob at Petromatrix, Zug, Switzerland. "Volume and volatility should come back in the second part of the week once the FOMC is out of the way," he said. [28] As crude oil prices continue to skyrocket, one of the most profitable ways to capture gains is with Canadian oil sands producers. While it's true that we get most of our crude oil from the Middle East, we also know that region of the world is rife with unrest and supplies disruptions. This leaves Canada positioned to pick up the slack and capitalize to meet booming global demand for oil. Don't think for a second that Canada isn't a major player; it's only second in the world in terms of oil reserves behind Saudi Arabia. [29]
The crude price slumped as the New York Mercantile Exchange reopened Apr. 18 with Saudi Arabia Oil Minister Ali I. Al-Naimi claiming the global oil market is oversupplied. [30] The June contract for benchmark U.S. light, sweet crudes traded at $111.08-113.48/bbl Apr. 25 on the New York Mercantile Exchange before closing at $112.28/bbl, down just 1¢ for the day. [28] HOUSTON, Apr. 26 -- On Apr. 25, the first trading day in the New York market after the long Easter weekend, the front-month crude contract "hopped to a new 2½-year high on escalating tension in the Middle East and a weaker dollar before retreating to end the day flat," said analysts in the Houston office of Raymond James & Associates Inc. Natural gas fell 0.5% on forecasts for moderate weather, they said. Crude continued its decline in early trading Apr. 26, but gas and broader market futures were up. [28] NEW YORK, April 27 (Reuters) - Brent crude futures turned higher on Wednesday in volatile trading after initially falling further on a more-than-expected rise in U.S. crude oil stockpiles. [31] NEW YORK, April 27 (Reuters) - Brent and U.S. crude futures pared losses on Wednesday after initially extending them, reacting to a government report showing crude oil stockpiles rose much more than expected last week. [32] NEW YORK, April 27 (Reuters) - U.S. crude futures turned higher and Brent extended gains to more than $1 on Wednesday reacting to a government report showing gasoline stockpiles fell more than expected last week in the United States. [33]
Coming up: EIA oil data, 10:30 a.m. EDT Wednesday NEW YORK, April 27 (Reuters) - U.S. crude futures edged up in choppy trading on Wednesday ahead of. [2] Coming up: API oil inventory data, 4:30 p.m. EDT Tuesday NEW YORK, April 26 (Reuters) - U.S. crude futures edged up in seesaw trading on. [1]
Futures in New York fell earlier by as much as 0.5 percent after U.S. Treasury Secretary Timothy Geithner said oil prices have become an obstacle to economic growth. [34] NEW YORK (Dow Jones)--Crude oil futures prices fell at mid-morning after government data showed a larger-than-expected rise in inventories. [21] NEW YORK (Dow Jones)--Crude oil futures prices were slightly weaker Tuesday, as gasoline prices continued strong ahead of the peak demand season. [35]
Oil traded near its lowest price in a week in New York amid speculation that rising U.S. inventories show demand is slowing in the world'''s biggest crude consumer. [17]
LONDON, April 27 (Reuters) - Brent oil pared gains to around $124 a barrel on Wednesday and U.S. crude fell as a big rise in U.S. inventories countered support from a weaker dollar before a Federal Reserve statement expected to keep a loose monetary policy. [22] Oil prices recovered from early losses on Tuesday, with Brent crude LCOc1 trading up 16 cents at $123.82 a barrel at 1059 GMT. Aramco Chief Executive Khalid al-Falih's comments at an industry event in South Korea had weighed on sentiment earlier, when prices fell amid a wider decline in commodities. "We are not comfortable with oil prices where they are today. [36] June oil fell 49 cents, or 0.4 percent, to $111.79 a barrel in electronic trading at 4:32 p.m. '''We are not comfortable with oil prices where they are today,''' al-Falih said today in Seoul. [23]
Oil prices fell to near $111 a barrel Tuesday in Asia as a stronger dollar made crude more expensive for investors with other currencies. [16] Brent crude on the ICE futures exchange recently fell 92 cents, or 0.7%, to $123.07 a barrel. Crude prices reversed course as the dollar pared its losses and traders looked to lock in profits following the morning rally. [37] The contract fell yesterday to $112.21, the lowest settlement since April 20. Brent crude for June settlement on the London-based ICE Futures Europe exchange was up two cents at $124.16 a barrel after falling 32 cents to $123.82. [17] In London, Brent crude for June delivery was down 74 cents to $122.92 a barrel on the ICE Futures exchange. [16]
Light Sweet Crude Oil (WTI) futures for June delivery are losing $0.92 to $111.29 a barrel. Earlier this month, oil advanced to a 30-month high above $113 amid speculation that unrest in the Middle-east will hamper supplies. [19] Crude oil for June delivery is now trading at around $112 a barrel, which represents a 32% rise in the past year. The path of least resistance is for crude oil to revisit its all-time high of $147.27 a barrel. [29] It's possible that Fed chairman Ben Bernanke will hint at an end to his dollar printing campaign when he hosts the first-ever Q&A; style press conference by a Fed chairman on Wednesday. This conference will follow an interest rate decision by Bernanke, where he's expected to maintain interest rates between zero and 0.25%. Related: 5 Stocks Worth Trading Into May Even if that plays out, I still think crude oil will stay in its uptrend and potentially trade toward $150 to $200 barrel in the next six to 12 months. [29]
On Apr. 15, the May contract for benchmark U.S. light, sweet crudes climbed as high as $110.10/bbl in intraday trading before closing at $109.66/bbl, up $1.55 for the day as revolution continued to disrupt Libya's oil production. [30] The contract had value, because it entitled the holder to buy a certain amount of a commodity, be it corn or live hogs (pigs) or coffee (or tulips) at a specific price. It is not surprising that in the 20 th century, Chicago, the central transhipment point for agricultural commodities in the U.S., also became America's and the world's central futures exchange. Commodities trading has always traditionally relied on the futures market to allow traders to buy and sell commodities. While some traders are buying on behalf of end users, like airlines which need to secure future oil supplies at a specific price, many represent speculators, whether they be banks, hedge funds, or wealthy individuals. [38] A good example is the Brent Crude futures contract, traded on the ICE exchange in London. This is one of the most closely followed oil futures contracts, and is priced in U.S. dollars. [38]
Brent oil for June settlement increased $1.19, or 1 percent, to $125.33 a barrel on the London-based ICE Futures Europe exchange. [39] Brent for June settlement rose as much as 84 cents to $124.98 a barrel and was at $124.37 at 1:33 p.m. on the ICE Futures Europe Exchange in London. [34]
Brent crude for June was at a premium of $11.49 a barrel to New York futures settling in the same month, Bloomberg data showed. [5] New York's main contract, light sweet crude for June, fell 30 cents to $111.98 a barrel. It had reached a 2.5-year high of $113.48 on Monday. [40] Crude in New York was up 9 cents at $112.30 a barrel after rising as much as 58 cents, or 0.5 percent, to $112.79. [34]
New York futures traded at $111.35 a barrel before the release of the report at 10:30 a.m. in Washington. [39] '''We'''re reacting to the S&P 500 and the U.S. dollar,''' said Tim Evans, an energy analyst at Citi Futures Perspective in New York. '''We have people adjusting their risk positions continually''' as prices touched technical levels. [15] '''We'''re reacting to the S&P 500 and the U.S. dollar,''' said Tim Evans, an energy analyst at Citi Futures Perspective in New York. [4]
'''We hit that high, and people said that'''s as high as we'''re going to go today, so I'''m going to take my profits,''' said Carl Larry, president of Oil Outlooks & Opinions LLC in Houston. The Dollar Index, a gauge of the U.S. currency against six counterparts such as the euro and the yen, rose as much as 0.2 percent to 74.268. It slipped 0.2 percent to 73.985 at 3 p.m. in New York. The index has fallen 6.4 percent this year. [15] Oil volume in electronic trading on the Nymex was 407,247 contracts as of 3:18 p.m. in New York. Volume totaled 346,707 contracts yesterday, 55 percent below the average of the past three months and the lowest level this year. [23]
Oil has rallied 32 percent in New York since protests against Libyan leader Muammar Qaddafi began Feb. 15, cutting the country's oil production and fueling speculation Middle East supplies will be disrupted. [8] April 25 (Bloomberg) -- Crude oil gained for a fourth day in New York, the longest rising streak since December, as escalating violence in the Middle East and Africa threatened to prolong supply disruptions. [5] NEW YORK ( TheStreet ) -- Crude oil seesawed on Tuesday and settled in line with the previous day's trade, as the Federal Open Market Committee meeting and Fed chairman Ben Bernanke's press conference scheduled for Wednesday weighed on the recent upside in the oil markets. [41]
April 26 (Bloomberg) -- Oil erased earlier losses in New York and advanced in London as the dollar extended its decline, increasing the investment appeal of crude and other commodities priced in the U.S. currency. [14] NEW YORK -(Dow Jones)- U.S. crude inventories soared well above analysts' expectations last week, according to data released Wednesday by the the U.S. Department of Energy. [42] U.S. crude inventories climbed 1.5 million barrels last week, the seventh time in eight weeks, according to the median estimate of seven analysts surveyed by Bloomberg News before a government report tomorrow. The industry-funded American Petroleum Institute will publish its own data today. [43] Crude inventories in the U.S. probably climbed 1.7 million barrels last week from 357 million in the period ended April 15, according to the median estimate of 13 analysts surveyed by Bloomberg News before a government report tomorrow. It would be the seventh increase in eight weeks. To contact the editor responsible for this story: Bill Banker at [email protected]. [23]
The kingdom pumped 9 million barrels a day last month, the most since October 2008, according to a Bloomberg News survey of producers and analysts. "We are not comfortable with oil prices where they are today," al-Falih said. [8] Data from the industry group American Petroleum Institute late Tuesday showed domestic crude stocks rose 4.9 million barrels last week due to higher imports. That pulled back crude prices, though still remaining much above the day's session low. [9] Crude oil stockpiles rose 6.2 million barrels to 363.1 million barrels, compared with an average survey estimate of a 900,000-barrel increase. The American Petroleum Institute, an industry group, reported a 4.9-million barrel build in its weekly report released Tuesday. [42] The week before, crude oil inventories unexpectedly decreased by 2.3 million barrels to 357.00 million barrels. [19]
U.S. crude inventories fell 2.32 million barrels to 357 million, the first drop since February, the Energy Department said. [15] U.S. crude stocks jumped 4.9 million barrels last week as imports increased, the industry group the American Petroleum Institute said in a report released late Tuesday. [2] Domestic crude stocks rose 6.16 million barrels in the week to April 22 to 363.13 million barrels, the report showed, versus expectations for an 800,000-barrel build in a Reuters poll of analysts. [6] Gasoline stocks fell 2.1 million barrels and distillate inventories rose 1.5 million barrels, the API report said. [2] The API said gasoline stocks fell 2.1 million barrels, a lot more than the forecast for a 1.3 million barrel drop, and distillate stocks rose 1.5 million barrels, larger than the forecast for a 400,000 barrel increase. [9]
Distillate stocks, which include heating oil and diesel fuel, fell by 1.8 million barrels to 146.5 million barrels, compared with analysts' forecast of a 200,000-barrel increase. [42] Gasoline stocks fell 2.51 million barrels, compared with forecasts for a 1.1 million barrel drop, the EIA said. [22]
Futures climbed as much as 0.8 percent after the department said gasoline inventories fell 2.51 million barrels to 205.6 million last week. [39] Gasoline supplies fell by 2.5 million barrels, or 1.2 percent, to 205.6 million barrels. That was a bigger drop than analysts expected and 8.1 percent below year-ago levels. [7] Gasoline supplies, however, have fallen for nine straight weeks. Gasoline stockpiles declined by 2.5 million barrels to 205.6 million barrels, the department's Energy Information Administration said in its weekly report, compared with a 1.1-million-barrel drop forecast in a Dow Jones Newswires survey of analysts. [42]
Prices briefly dropped on a 6.16 million -barrel gain in crude oil supplies and surging imports. '''This was a mixed report,''' said Gene McGillian, a broker and analyst with Tradition Energy in Stamford, Connecticut. [39] At KBC Energy Economics, a division of KBC Advanced Technologies PLC, analysts said the recent surge in oil prices is part of a wider upsurge in commodity prices--including gold, corn, and copper--that is fuelling inflation around the world. "Markets enjoyed sufficient supplies of crude and the recent oil price rise had nothing to do with market fundamentals but with the current geo-political situation and speculation," said Mohammed bin Dhaen Al Hameli, oil minister of the UAE. That country sent 500 police to join Saudi troops in assisting Bahraini King Hamed ibn Isa Khalifa against demonstrators. [26]
Futures slid earlier after Saudi Aramco Chief Executive Officer Khalid al-Falih said the world'''s biggest crude exporter is concerned about the impact of prices on economic growth. Oil also declined with other commodities amid speculation that the Federal Reserve may end its bond-buying program. [43] UAE Energy Minister Mohammed bin Dhaen Al-Hamli said oil priced at $120/bbl "does not interest us in the short term if it undermines long-term economic growth and leads to a collapse in demand and prices in future years." [27] There was no tightness in global oil markets, Falih said. His comments echoed those of Saudi Oil Minister Ali al-Naimi, who said last week that the kingdom had cut oil output in March as the market was oversupplied. Unrest in North Africa and the Middle East and strong demand growth in Asia have pushed oil prices to their highest levels since 2008, triggering concern among consumers costly oil would harm economic growth and crimp fuel demand. OPEC producers also warned last week of the strain of high energy prices on economies still fragile as they emerge from the global financial crisis. [36] "Pushing through $113 takes more buying support, and we're in a range where people are happy to take profits," said commodities analyst Matt Smith of Summit Energy. "Despite everything going on in the Middle East, it's a bit of a stalemate." Phil Flynn, market strategist at PFG Best, said that a key resistance level for commodities, more generally than specific to oil prices, has been tested this week, with oil hitting $113 on Monday and silver testing $50, and that the Fed meeting has heightened the focus on inflation and the run-up in commodities with a weak dollar. "I still think we exceed these levels; I think we just got there too soon, and that's one reason why people may have taken off some bets," Flynn said. [41]
Denatured ethanol for May delivery rose 4.5 cents to $2.631 a gallon on the Chicago Board of Trade. Prices have risen 11 percent this year. Kinder Morgan Energy Partners LP (KMP) is starting a portion of its 300,000-barrel-a-day Trans Mountain oil pipe that was shut April 22 due to a leak. Valero Energy Corp. (VLO) has completed maintenance on a hydrocracker at its McKee refinery in Texas and the plant is restarting the unit, Bill Day, a company spokesman, said in an e-mail. [4] The move by China, the world'''s fastest-growing oil consumer and the largest except for the U.S., may help policy makers curb loan growth after inflation accelerated and real estate prices rose following a $2.7 trillion two-year credit boom. The central bank this month raised the amount of deposits lenders must set aside to the highest in at least two decades, while the banking regulator ordered a new round of stress tests on property loans. [15] An industry-funded report showed crude supplies increased the most in four weeks and U.S. Treasury Secretary Timothy Geithner said oil prices are an obstacle to economic growth. [3] '''We'''re concerned about the impact it could have on global economic growth.''' With crude priced in dollars, a weaker U.S. currency reduces the purchasing power of countries such as Saudi Arabia, whose economies are dependent on oil. [23] April 26 (Bloomberg) -- Saudi Arabia, the world's largest oil exporter, is "not comfortable" with the current crude price and is concerned about its effect on global economic growth, the head of the state oil company said. [8]
Oil slipped for a second day after the head of Saudi Arabia '''s national oil company said the kingdom isn'''t comfortable with prices near a 31-month high and on concern rising futures will slow the economic recovery. [23] If the oil market is a predictor of anything besides prices in the future, things are about to get a lot hotter in Libya or in Saudi Arabia, or maybe both. [44] Protecting against a "Gulf War"-like escalation seems to be what the market is predicting today. Two specific disruptions could fit the bill for this kind of event: Real "boots on the ground" action in Libya by U.S. or NATO forces, or even a further contagion of Yemen and Bahrain disruptions into Saudi Arabia, where the United States would be practically forced to protect the Kingdom in a way they have not been obligated elsewhere in the region. The question becomes: How good is the oil market at predicting the future? Its history has been spotty, but if you believe in "the Wisdom of Crowds" and James Surowiecki's work, it's certainly something to take seriously - the participants engaged in trading oil are necessarily much more attuned to the geopolitical possibilities than the rest of us. [44]
Trading was volatile as the report also showed gasoline stocks fell more than expected, lending support to U.S. gasoline futures and the oil futures complex. [32]
The FOMC is scheduled to release its post-meeting policy statement at 12:30 p.m.ET. Central bank Chairman Ben Bernanke is due to hold a press briefing at 2:15 p.m. ET to explain the FOMC's latest quarterly economic projections. Today during trading hours, the EIA will release its U.S. crude oil inventories report for the week ended April 22. [20] April 27 (Bloomberg) -- Crude oil declined after a U.S. Energy Department report showed that inventories surged by the most in nine months as imports increased. [10] Crude oil increased after a U.S. Energy Department report showed that gasoline stockpiles tumbled to the lowest level since August 2009. [39]
WINDERMERE, Fla. ( Stockpickr ) -- Crude oil prices continue to skyrocket due to tensions in the Middle East and North Africa -- and due to an even more serious driver, the plunging U.S. dollar. The U.S. dollar is hovering just barely above its three-year lows, which it hit last week at 73.73. [29] Projected oil price volatility, metered by the CBOE Crude Oil Volatility Index OVX, fell to 30.5 percent from 32.4 percent last week. [18] Here's a look at a number Canadian oil sands stocks that are positioned to benefit off of rising crude oil prices. [29]
'''Nigeria'''s production of sweet crude oil is definitely an exponential price factor now that Libya'''s sweet crude oil production is out,''' Bjarne Schieldrop, chief commodities analyst at Stockholm-based SEB AB, said in a note. [43] You may hear commodity brokers or analysts talk about 'June Brent', meaning the June delivery contract for Brent crude oil. [38] In London, ICE Brent crude for June delivery LCOM1 setled at $124.14, rising 48 cents, or 0.39 percent, trading between $122.78 and $124.40. [9] Light, sweet crude for June delivery settled down a penny to $112.28 a barrel in thin trading. [45]
Political strife in Nigeria, Africa's largest producer and the fourth-biggest crude seller to the U.S., is also supporting prices above $100 a barrel, according to Ken Hasegawa, an energy trading manager at Newedge, a broker in Tokyo. At least 500 people died in religious rioting that followed Nigeria's presidential election, the Associated Press reported today. [5]
Oil fell as much $1.16 a barrel today. It climbed as much as 36 cents after a report that U.S. consumer confidence increased more than forecast in April. [23] U.S. crude was down 35 cents to $111.86. Dollar weakness lent oil and other dollar-denominated commodities such as gold some support. The dollar slid to a three-year low against other major currencies as investors bet that the Fed, after its meeting that ends on Wednesday, would keep an easy policy. Its decision is due at 1630 GMT. [22] World oil prices fell in Asia as investors awaited a decision after a two-day policy meeting of the U.S. central bank, which analysts said could set the tone for a weaker U.S. dollar. [12] The dollar traded near a 16- month low against the euro and a two-year low against the pound, boosting the appeal of commodities priced in the U.S. currency. '''Both demand data and macroeconomic data continue to surprise to the upside and despite worries of slowdown from higher prices, we haven'''t seen any effects yet,''' Amrita Sen, a London-based oil analyst at Barclays Plc, said by e-mail. '''That'''s what is supporting prices.''' [34]
April 27 (Bloomberg) -- Oil traded near the lowest in almost a week on speculation fuel demand in the world's biggest crude-consuming nation may falter after U.S. residential real- estate prices dropped the most in more than a year. [3] Oil climbed in London after European economic data indicated demand may be recovering in the region, easing concern that oil prices near their highest in more than two years may be hurting growth. [34] Shum said investors also continue to monitor the turmoil in the Middle East and North Africa which could impact supplies. He said concerns about high oil prices negatively impacting demand growth and global economic recovery are limiting the increase. [12] Westgate said, "Even ongoing post-election unrest in Nigeria has failed to register with the markets and, after rallying strongly on Apr. 20, West Texas Intermediate has since traded in a fairly narrow range." He added, "As far as the wider energy markets are concerned, there is essentially a battle between supply fears in the Middle East vs. the risk of demand destruction and lower economic growth from higher energy prices, and the impact from aggressive monetary tightening measures in China and the impact from what is likely to be a very slow normalization in U.S. fiscal conditions." [28]
Oil'''s price surge has created '''new headwinds''' against economic growth, Geithner said today at the Council on Foreign Relations in New York. [23] Oil'''s rally has created '''new headwinds''' against economic growth, Geithner told the Council on Foreign Relations in New York yesterday, even as a Conference Board index showed consumer confidence increased more than forecast in April. [17]
Reformulated gasoline blendstock, or RBOB, for May delivery settled up 1.43 cents, or 0.4%, to $3.3229 a gallon on the New York Mercantile Exchange, the highest settlement since July 2008. [45] Heating oil for May delivery dropped 1.72 cents, or 0.5 percent, to settle at $3.182 a gallon on the exchange. [4]
In other Nymex trading in May contracts, heating oil fell 1.2 cents to $3.17 a gallon and gasoline slid 2.3 cents to $3.30 a gallon. [16] A key technical threshold was also weighing on the oil trade, as crude oil had topped $113 during Monday trading. [41] The best part about Canadian oil sands is that it only costs around $30 to $40 per barrel to extract oil from the sand. The higher crude oil goes, the more profitable it becomes for Canadian oil sands producers and the higher the probability they will see massive revenues. [29] Aramco will spend $125 billion on domestic and overseas projects over the next five years, al Falih said. The investment will be focused not only on new crude oil increments but on the natural gas and petrochemical sectors, Yonhap news agency quoted him as saying. [24] Hanoi plans a second, larger refinery with 200,000 bpd capacity, but Kuwait is the crude supply partner in that venture. Combined, the new plants Aramco is considering and those underway would boost Saudi global refining capacity to over 6 million bpd from around 4 million bpd, Falih said. Aramco also continued to expand its domestic gas system, which would have capacity to pipe above 15 billion standard cubic feet per day in the next five years, he said. The kingdom plans to spend more than $450 billion on capital projects over the next five years, he said. [36] As Muammar Qaddafi'''s forces strafed crowds of protesters in Tripoli with automatic gunfire on Feb. 21, the dictator'''s money manager fled the city in a car to the airport to escape the violence. Saudi Arabia will keep its output capacity for crude at 12.5 million barrels a day, a Saudi official said in response to a report that the world'''s largest exporter might increase the amount it can produce. [46] Saudi Arabia intends to keep production at 12.5 million barrels a day, according to the latest reports. They say there's too much supply. [25]
Four "grassroots" refineries were being considered including one at Jaizan in Saudi Arabia, plus possible joint-venture refinery projects in China, Vietnam and Indonesia, the CEO said. Refining capacity would "soon" surpass the current four million barrels per day, he said, without giving a timeframe for this or the six million barrel figure. [24]
Oil refinery inputs averaged 14.1 million barrels per day during the week, which were 27,000 barrels per day below the previous week's average as refineries operated at 82.70 percent of their operable capacity. [19] Aramco is considering building three new joint venture refineries in Asia as part of plans to boost its global refining capacity by 50 percent to over 6 million barrels per day (bpd), Falih said. [36]
Libyan crude output, which averaged 1.6 million barrels a day last year, fell to 390,000 barrels a day in March, according to a Bloomberg News survey. [15] Demand for gasoline over the four weeks ended April 22 was 1.6 percent lower than a year earlier, averaging about 9.1 million barrels a day. [7] Refineries operated at 82.7 percent of capacity vs. 82.5 percent the previous week. Gasoline demand, at a daily average of 9.1 million barrels, is down 1.6 percent from this time last year. [18]
Riyadh boosted capacity to 12.5 million barrels per day (bpd) in 2009, just as the global economic downturn cut demand. This left it with a supply cushion of over 4 million bpd, more than twice the spare capacity it targets of 1.5 million bpd to 2 million bpd. [36]
OPEC's largest producer boosted supply in February to above 9 million bpd to plug the gap left by fellow OPEC member Libya, where civil war cut exports. Saudi Arabia is the only oil producer with significant spare capacity to meet large supply outages such as that experienced in Libya. [36] The cutoff of Libyan oil was almost 2 percent of the world supply and OPEC's spare capacity turned out to be a mirage. Saudi Arabia now says that they actually decreased oil production by another 1 percent in March. [47] Saudi Arabia, holder of the world's largest crude reserves, has no plans to raise production capacity, a Saudi oil official said. [5] Saudi Arabia, the world'''s largest oil exporter, is '''not comfortable''' with current prices and will maintain spare production capacity to stabilize the market. [46] Saudi Arabia's production cut in a period of near-record-high prices is "a game changer" for world oil markets, said Olivier Jakob at Petromatrix in Zug, Switzerland. [26]
Crude prices, which have risen significantly over the past two months, would suggest otherwise. It's pretty clear that Saudi Arabia DID NOT make up for supply when the Libyan conflict erupted. One Saudi official who did not wish to be named said the kingdom did indeed increase its production in February. [25]
Exports of crude from Saudi Arabia to China have doubled since 2007, and Saudi Arabia is now exporting as much crude oil to China as to the U.S. (OGJ Online, Mar. 23, 2011). [26] The crude oil that's produced in Saudi Arabia is different than that produced in Libya and it requires a different type of refining facility. [25] Even if Saudi Arabia were pumping more oil, it wouldn't fill the gap from Libya in the crude market. [25]
Al-Naimi said Saudi Arabia sold 2 million bbl of a special blend of crude meant to replicate the high-quality Libyan oil that was shut in by the revolution in that country, but traders reported demand for the blend was tepid. [26]
In many countries, unemployment remains at unacceptable levels," Saudi Arabia's Minister of Petroleum and Mineral Resources Ali I. al-Naimi told the conference. Kuwait Oil Minister Sheikh Ahmad Al-Abdullah Al-Sabah said, "At these high price levels, spending on oil imports could represent a significant economic burden for many import-dependent countries." [27] Obama's appeal followed comments from top oil exporter Saudi Arabia earlier in the day that it was not comfortable with high oil prices and a strike last week by truckers in China protesting over higher fuel costs. [22] SEOUL, April 26 (Reuters) - Top oil exporter Saudi Arabia is uneasy with high oil prices and concerned about their impact on the global economy, the chief executive of state oil firm Aramco said on Tuesday. [36] Saudi Aramco chief executive Khalid al-Falih said on Tuesday key producer Saudi Arabia was not comfortable with current oil prices. "We are not comfortable with oil prices where they are today. [48]
Indonesia's energy minister said earlier in April that Saudi Arabia was among Middle East energy giants that had expressed interest in participating in two new oil refineries. [36] Addressing the roundtable meeting, Al-Naimi assured ministers Saudi Arabia is able to fulfill Asia's future oil requirements. [26]
Oil also rose as gasoline futures surged to a 33-month high after refineries with almost 5 percent of U.S. fuel-making capacity were knocked offline because of a power failure late yesterday in Texas City, Texas. [23] Brunei Shell Petroleum Co., the Southeast Asian country'''s biggest oil producer, increased crude official selling prices to the highest in 31 months after benchmark futures rose. [46] Crude futures shrugged off the data showing crude oil stockpiles rose more than expected. [33] Nymex crude oil futures reached as high as $112.64 during Tuesday's market action, but settled in the afternoon at $112.21, higher than the previous settle of $112.11. [41]
SINGAPORE, April 26 (Reuters) - U.S. crude futures fell more than $1 early on Tuesday, snapping three days of gains. [48]
NEW YORK (Dow Jones)--Gasoline futures rose to their highest level in almost three years Monday, on expectations of further declines in U.S. supplies. [45] NEW YORK (Dow Jones)--Oil futures turned lower Monday, as the dollar recouped its losses and traders looked to lock in profits after prices earlier breached two-and-a-half-year highs. [37]
The dollar fell 0.5 percent against the euro to $1.4645 at 3:14 p.m. in New York. [23] The Dollar Index, which measures the greenback against six other major currencies, fell 0.1 percent as of 4:58 p.m. in New York, and the Standard & Poor'''s 500 Index dropped 0.2 percent to 1,335.25. [4]
The S&P; 500 fell 0.1 percent to 1,335.88 at 3 p.m. in New York, and the Dow Jones Industrial Average dropped 22.86 points, or 0.2 percent, to 12,483.13. [15]
Italian oil and gas group Eni, reporting earnings on Wednesday, said production fell almost 9 percent in the first quarter because of unrest in Libya. Lending support to Brent, BP said the North Sea's Forties pipeline may have to be shut for a few days later this year due to the discovery of an unexploded German mine from World War Two. [22] Brent has advanced 22 percent since protests against Libyan leader Muammar Qaddafi began Feb. 15, cutting the country'''s oil production and heightening speculation Middle East exports will be disrupted. [17]
Futures slipped as much as 1.3 percent after the government said supplies rose 6.16 million barrels to 363.1 million last week. It was the biggest one-week advance since July. [10] Supplies of distillate fuel, which include diesel and heating oil, fell by 1.8 million barrels to 146.5 million barrels. [7] Crude inventories at the key Cushing, Oklahoma terminal fell 738,000 barrels to 40.39 million barrels. [6] Crude stockpiles nationwide fell 2.32 million barrels to 357 million, the first drop since February. [43]
Crude stockpiles climbed 1.7 million barrels from 357 million in the week ended April 22, according to the median estimate of 13 analysts polled. [17] Analysts expected an increase of 1.6 million barrels for the week ended April 22, according to Platts, the energy information arm of McGraw-Hill ( MHP - news - people ) Cos. [7]
Prices declined from the settlement after the American Petroleum Institute reported at 4:30 p.m. that U.S. crude-oil stockpiles increased 4.91 million barrels to 361 million. [23] U.S. gasoline supplies probably dropped 1 million barrels in the period ended April 21, the survey showed. [43] The industry group reported stockpiles of gasoline fell 2.1 million barrels and distillates rose by 1.5 million barrels. [42] Inventories of gasoline fell for the 10th week, by 2.51 million barrels to 205.59 million barrels, compared with expectations for a 1.1 million barrel draw. [6] Total motor gasoline inventories decreased by 2.5 million barrels last week and are in the lower limit of the average range. [49]
Gasoline stocks were expected to be down 1.1 million barrels and distillate stocks nearly unchanged, up only 100,000 barrels. [2] Government figures also showed a 2.5 million barrel drawdown in gasoline stocks, close to the API's guess of a 2.1 million barrel decline. [18]
Stockpiles of distillate fuel, a category that includes heating oil and diesel, declined 1.81 million barrels to 146.5 million. [39]
If a barrel of oil is sold for more dollars than before, the price of the gasoline it produces will also increase.'' [50] Oil ended flat near $112 for a second session as the U.S. dollar remained weak ahead of the Federal Reserve's upcoming interest rate announcement. [20] In late trading, the dollar dipped 0.30 percent against a currency basket.DXY. U.S. stocks hit their best levels since June 2008 amid a fresh batch of better than expected corporate earnings. Federal Reserve statement on results of its meeting, 12:30 p.m. EDT (1630 GMT) Wednesday. [9] Forecast-beating results from big U.S. corporations and expectations of more of the same easy money policies from the Federal Reserve lifted index futures, with stocks set to run higher after the S&P; 500 moved above a technical resistance level. [2]
The dollar index.DXY weakened ahead of the Federal Reserve FOMC meeting. The euro hit a 16-month high against the dollar, helped by demand from sovereign investors, with expectations that the U.S. Federal Reserve will keep policy accommodative likely to see the euro extend its gains. [1] Analysts and brokers said investors would be cautious awaiting the result of the U.S. Federal Reserve's two-day policy meeting that starts on Tuesday and will include a news conference on Wednesday. Traders will try to decipher clues about the direction of monetary policy as the Fed's bond buying program nears its end in June. The dollar has been weighed on by expectations that the Fed will keep its loose monetary policy even after other central banks have moved to tighten and curb inflation. [1] New orders for long-lasting U.S. manufactured goods rose more than expected in March and bookings for the prior month were much stronger than initially thought, the Commerce Department said. The dollar fell against most currencies and looked set to stay under pressure on expectations the U.S. Federal Reserve will reaffirm its ultra-loose monetary policy for the coming months. [2]
The dollar dropped for a sixth day against the euro, matching the longest losing streak since May 2009, on speculation the Federal Reserve will consider measures to keep yields low to support the U.S. economy. [23] The euro marched to a 16-month high against the dollar as investors bet the U.S. Federal Reserve will lag other major central banks in raising interest rates. [9] There are now fears in the market that the dollar is setting up for an even more sinister decline as the U.S. government grapples with credit issues. The only near-term catalyst that might stop the dollar liquidation is if the Federal Reserve ends its quantitative easing policy in June. [29]
"The market is watching what is going to come out of the U.S. Federal Reserve Bank meeting. The market is watching for comments from Fed chairman Ben Bernanke on whether monetary tightening will begin," he said. [12] Traders said the participants appeared reluctant to aggressively push crude in either direction ahead of the start of the two-day Federal Open Market Committee meeting Tuesday and a scheduled press conference by Federal Reserve Board Chairman Ben Bernanke on Wednesday. Traders are awaiting signs of when the Fed may shift away from its policy of keeping interest rates at extremely low levels in an attempt to stimulate the economy. [35]
LONDON (Dow Jones)--Crude futures retraced earlier losses and turned positive Tuesday as the dollar weakened ahead of the U.S. Federal Open Market Committee's two-day meeting on interest rates, due to start later in the day. The Fed is expected to announce it will end its second round of quantitative easing in June,. [51]
Crude oil slipped after touching a 31-month high before slipping as U.S. equities declined and the dollar erased losses against other major currencies. Oil and the Standard & Poor'''s 500 Index dropped for the first time in a week as Kimberly-Clark Corp. (KMB) cut its profit forecast and shares of commodity producers decreased. [15] Saudi Aramco is a major shareholder of South Korea's third-largest crude oil refiner S-Oil with a 35 percent stake in the refiner, which is one of the world's largest with capacity of around 650,000 bpd. [36] Saudi Aramco, the world'''s largest oil exporter, will spend about $125 billion on projects over the next five years as it seeks to increase refining capacity by 50 percent, Chief Executive Officer Khalid al-Falih said. [46]
Brent traded at $127.02 a barrel on April 11, the highest level in more than 2 1/2 years, buoyed by concern that political unrest in Libya could spread to other producers including Algeria and Saudi Arabia. [34] Brent North Sea crude for delivery in June rose 14 cents to $123.80 a barrel in London trade following a four-day Easter break. [40] ICE Brent June crude LCOM1 fell 15 cents to $123.99 a barrel by 10:53 a.m. EDT (1453 GMT), having traded from $123.25 to $124.98. [32] Brent crude's premium over WTI fell from $15.47 a barrel to $12.56, while WTI's contango shrank significantly. Last week, a three-month roll cost $1.47 barrel vs. 87 cents this week. [18]
Brent crude for June was up 25 cents to $124.39 a barrel by 1508 GMT. On Tuesday, it gained 48 cents to settle at $124.14 a barrel, having bounced off a $122.78 low. [22]
ICE Brent June crude LCOM1 rose $1.20 to $125.34 a barrel by 11:48 a.m. EDT (1548 GMT), having traded from $123.25 to $125.50. [33]
Crude failed to maintain gains after reaching $113.48 a barrel, the highest intraday price since Sept. 22, 2008. [15] Light, sweet crude for June delivery recently traded $1.20, or 1.1%, lower at $111.01 a barrel. [42] Light, sweet crude for June delivery fell 90 cents, or 0.8%, to $111.39. [37]
The difference has shrunk from $13.05 a week earlier after supplies fell at Cushing, Oklahoma, the delivery point for U.S. contracts. [43] The May natural gas contract dropped 2.3¢ to $4.39/MMbtu on NYMEX. On the U.S. spot market, gas at Henry Hub, La., closed at $4.36/MMbtu on Apr. 25 compared with $4.33/MMbtu on Apr. 21. "Although we might get some more support from the projected hotter-than-normal weather in the Northeast later this week, prices are likely to come under pressure as milder weather spreads across much of the country," Sharma said. With U.S. storage already 9% below last year and expected to fall further, he said, "Even a small amount of weather support starts to threaten 3.8-3.9 tcf end of October storage projections and brings the bulls back into the market." [28]
"In the current backdrop," Sen said, "the threshold for a substantial price-driven demand reaction seems to have been pushed higher somewhat. Compared to the previous cycle, the demand reaction to pushing through $3/gal U.S. gasoline has not been replicated this time around, even with prices nearing $4/gal in many states. [30] U.S. crude supplies rose for the seventh time in eight weeks as imports rebounded and refineries prepared to bolster gasoline output to meet summer demand, a Bloomberg News survey showed. [46] U.S. crude inventories probably increased last week against a drop in gasoline supplies, a Bloomberg News survey showed before the Energy Department report. [34] A government report tomorrow may show crude supplies in the U.S. increased last week, according to a Bloomberg News survey. [43]
"The ongoing coordinated actions in Libya to remove Qaddafi, if that is the actual purpose, is adding to the nervousness, prompting new buying in crude oil," John Caiazzo, president of Acuvest Commodity Brokers Inc. in Temecula, California, said in a report today. "Other producing areas experiencing turmoil include Yemen and Syria, where protesters are being killed as well." Yemeni President Ali Abdullah Saleh defied calls for him to resign immediately, saying he won't hand power to "insurrectionists" as protesters clashed with security forces in the city of Taiz. [5] Oil investors also awaited weekly oil inventory reports expected to show crude stocks rose last week. [1] Ahead of the report, a Reuters poll on Tuesday yielded a forecast for crude stocks to be up only 800,000 barrels. [2]
U.S. stocks index futures rose after earnings from Ford Motor Co ( F.N ) and 3M Co ( MMM.N ) beat analysts' forecasts on a big day for bellwether companies. [1] Index futures are mostly based on stock market indices, but there are some other indices like the VIX, the volatility or 'fear' index, which are not based on the performance of share prices. [38] Futures are also based on indices, including the big stock market indices like the Dow Jones Industrial Average or the FTSE 100. Called 'index futures', these contracts are often used by big money managers and investors to hedge their risks in the share markets. [38]
A June contract, for example, would expire on the 15 th of May. Commodity brokers and traders generally won't want to still be holding a commodity futures contract when it expires, as they would need to clear some space in their garage for all those barrels of oil that will turn up! Whoever holds the contract at expiry date is going to take delivery. [38] Oil is priced using futures markets, where contracts are deliverable every month. Therefore each month has a separate contract and a uniquely traded price. When you look at these prices placed in a time line, like a calendar, you get a mapping of prices that can either increase or decrease the further into the future you go. If prices generally increase, you have a "curve" of prices called a contango, if they tend to decrease, you have what is known as backwardation. [44] Futures exchanges, like the famous Chicago Mercantile Exchange, publish prices on what are called 'exchange traded contracts', namely a specific, tradable futures contract, that will expire at a specific date. [38] There are even some futures contracts based on the prices of shares in major companies, and big futures exchanges are adding more companies all the time. [38]
Commodity trading with futures is quite expensive for the private investor, as the minimum contract sizes on exchanges are substantial. [38] Some exchanges are introducing smaller minimum lot sizes in an effort to make futures trading more accessible for private investors (e.g. the e-Mini futures introduced by the Chicago Mercantile Exchange), but for the UK-based investor, the best way to trade futures is via a spread bet. [38]
Bullish bets on crude climbed in the past week, according to the Commodity Futures Trading Commission'''s weekly Commitments of Traders report. [15]
Net-long positions in oil increased 8,337 futures and options combined, or 3 percent, to 289,916, according to the CFTC report. [15] I'm simplifying for clarity, but a contango curve is normally more demand sensitive, among other things - the bets in the oil market are engaged to protect against an increasing industrial need for oil in the future, perhaps even protecting against future hoarding. We've seen a constant contango curve in oil since 2006 and saw the most intense contango in the oil market on a percentage basis during 2009, when oil was reaching the nadir of its deleveraged move from the collapse of all the markets in late 2008. What the oil market was saying during this time was "Oil demand may be slack now, but I'm still betting strongly on increased demand in the future". This is the curve we associate with emerging economy growth and peak oil arguments as the drivers of oil price. [44] One component of rising oil prices is due to growth in demand as the world and U.S. economies finally recover from the recession.'' [50] U.S. Treasury Secretary Timothy Geithner said today that oil prices have become an obstacle to economic growth. [23]
The Philippines's Energy Sec. Jay Layug underlined the concerns of his country regarding higher prices, exhorting members of OPEC, the International Energy Forum, and the International Energy Agency to help countries like the Philippines that had been adversely impacted by the soaring world oil prices. "While there is so much optimism in the new Aquino administration, we do not wish for the oil price volatility to affect the potential of the country to meet its aspirational economic targets," Layug said. [27] '''The fact that the housing market looks pretty lousy is making people nervous, and there are more and more stories about the effect of high oil prices on corporate earnings and on people'''s summer vacations,''' said Michael Lynch, president of Strategic Energy & Economic Research in Winchester, Massachusetts. [23] Energy officials attending the 4th Asian Ministerial Energy Roundtable in Kuwait have heard from leading Middle Eastern oil ministers that higher oil prices could threaten the world's economic recovery. [27]
The statements reflect a concern among members of the Organization of Petroleum Exporting Countries that increased oil prices could lead to demand destruction and loss of markets to other players or forms of energy. [27] The kingdom has enough capacity to meet any spike in demand and plug short-term outages in supply, Falih said, adding that without Saudi spare capacity, oil price volatility would have been a lot worse when Libyan supply was lost. [36] The impact of higher prices was outlined by John Sfakianakis, chief economist at the Riyadh-based Banque Saudi Fransi. He said, "If oil prices surge further, they could threaten recovery of the global economy, which is already complicated and difficult due to a variety of risks." [27]
HOUSTON, Apr. 25 -- Ministers of the Organization of Petroleum Exporting Countries expressed concern over high oil prices in world oil markets, but reiterated their claim there is no shortage of crude supplies. [26] Oil prices could keep climbing toward the highs of 2008 as resurgent demand isn't matched by additional supplies and the price spike is slow to bite into consumption. [11] If OPEC will not raise output, then demand growth will eventually have to fall, and that will only be brought about by oil prices rising to levels high enough to begin destroying demand--exactly as happened in 2008. While the balance of fundamental factors driving oil prices upwards may differ from those in 2008, their net effect may be horribly similar." [30] In that context, the price levels at which global oil demand is choked off have not been truly tested yet." [30]
The Saudi minister said future high demand for oil would be maintained by Asia's developing markets, while current demand levels among developed nations would remain unchanged. [26] Two out of every three barrels that Saudi Aramco exports go to Asia, Falih said. The state oil giant is expanding its presence in the refineries in the region that process its oil, locking in market share and long-term demand. [36]
The sharp and sustained rise in the crude market since the end of February, regardless of rumors about Saudi oil production. [25] The crisis in Libya has also helped to drive up oil prices around the world.'' Even though Libyan oil primarily supplied Europe, when Libyan production was lost European companies had to look elsewhere for oil to meet their needs, driving prices up.'' In the ongoing struggle, Libya is estimated to have lost two-thirds of its oil production.'' Prior to the war, Libya ranked 17th in world oil production with most of its exports going to Italy and Germany.'' [50] Oil reserves that were not economical to tap at lower prices are suddenly more attractive.'' Other producers, such as OPEC countries, have historically ignored production quotas to take advantage of rising prices as well.'' [50]
Like some members of the U.S. Congress, Al-Badri called for "regulations" to curb speculation in oil markets. He also voiced OPEC's long-standing complaint that high taxes on oil products in the major consumer countries contributes to high petroleum prices. [26] Gasoline shipments to the U.S. from Europe are poised to drop in April to the lowest in four months, reinforcing speculation that a surge in pump prices is hurting consumption in the world'''s biggest oil user. At least 15 tankers were scheduled to ship 570,000 metric tons of the fuel to the U.S. Atlantic Coast from Europe as of April 20, the least for a comparable period since December, according to Clarkson Research Services Ltd., a unit of the world'''s biggest shipbroker. [34] April 27 (Bloomberg) -- Oil traded near the lowest in almost a week on speculation fuel demand in the world's biggest crude-consuming nation may falter after U.S. residential real- estate prices dropped the most in more. [3] High oil prices have yet to trigger a major reduction in oil demand either in or out of the Organization for Economic Cooperation and Development. [30] OPEC members also are concerned about having to shoulder the blame for the increased burden of higher oil prices on the world's economic recovery as well as on the ability of emerging economies to compete. [27]
Russia will remove export duty breaks for two more oilfields, a finance ministry official said, squeezing oil companies profits ahead of an election year and amid surging crude prices. [1] LONDON — Crude prices steadied Tuesday as the market looked ahead to the publication later this week of growth data in the United States -- the world's leading consumer of oil. [40]
Heating oil's 2.3 percent rise was slightly ahead of the 2.2 percent gain in gasoline prices. [18] Gasoline has risen 41 percent in the past year. Regular gasoline at the pump increased 0.3 cent to $3.863 a gallon yesterday, AAA said on its website. That'''s the highest price since August 2008. [4] Gasoline for May delivery gained 1.43 cents, or 0.4 percent, to settle at $3.3229 a gallon on the Nymex. It was the highest settlement for the front-month contract since July 15, 2008. [4] The contract slid 7 cents to $112.21, the lowest settlement since April 20. [3]
The difference between front- month contracts in London and New York surged to a record $19.54 on Feb. 21. [3] Leon Westgate at Standard New York Securities Inc., the Standard Bank Group, finds the market "increasingly desensitized to the ongoing turmoil in the Middle East and North Africa (MENA)." As a result he said crude is looking towards the dollar and other exogenous factors for direction." [28]
The Energy Department may say today crude stockpiles in the country climbed even as gasoline supplies declined, while violence in Syria fanned concern that Middle East unrest will continue to disrupt supplies. [17] The units were restarted after power was restored, the filing said. Holly Corp. shut down its West facility crude unit after a mechanical failure that was discovered on April 22. Gasoline extended its 33-month high, gaining for the third day in a row on speculation that U.S. supplies dropped to an 18- month low last week. [46]
Atlanta'''s gas prices are about nine cents cheaper than the national average, but have risen at the same rate.'' According to a forecast by the U.S. Energy Information Administration, gasoline prices could exceed four dollars per gallon this summer. To find out when the country will get relief from these high gas prices, it is first necessary to understand why they are rising in the first place.'' [50] The U.S.E.I.A. Short Term Energy and Summer Fuels Outlook (April 12, 2011) mentions two other factors in the rising price of gasoline and oil.'' [50] The prices of other things are rising as well because oil and gasoline are used to manufacture and transport a large number of products.'' [50]
We're so dependent on oil that it takes a painful increase in price to get people to buy less. That being said, let's get serious about all kinds of financial speculation. Let's tax every trade in all financial securities and commodities and require that all such trades be on fully regulated exchanges with no buying on margin or other gimmicks. [47]
The seesaw action in the oil trade could be part of a late-to-the-game market syndrome as well, said commodities trading adviser John McClane of Mobius Asset Management. "This has been the spot where oil pauses a little, and all the weaklings are run out, the profit-takers who came in late to the game and at the first visit from the boogeyman are heading out," McClane said. "It's going to be harder to push past $113 before the Fed meeting," the portfolio manager said. [41] The $113 level has proved to be the recent resistance point for the oil trade. [41]
Heating oil for May delivery dropped 1.72¢ to $3.18/gal on NYMEX. Reformulated blend stock for oxygenate blending for the same month, however, was up $1.43¢ to $3.32/gal. [28] The premium has shrunk $2.54 from a week earlier as supplies fell at Cushing, Oklahoma, the delivery point for West Texas Intermediate futures. [15] The European benchmark traded at a premium of $11.93 a barrel to U.S. futures yesterday. [3] Traders were awaiting Thursday's publication of U.S. gross domestic product (GDP) data for the first three months of 2011, which is key to future energy demand in the world's biggest economy. [40] Brent futures advanced as much as 0.7 percent after reports showed that industrial orders in the euro region gained for a fifth month in February, led by demand for capital goods, and that Britain'''s economy rebounded in the first quarter as growth surged in the service industry. [34]
In the case of the Brent futures contract, it expires on the 15 th day of the month before the delivery month. [38] The first futures traders traded paper contracts that allowed them to take delivery of a commodity at a specific price (the infamous 'tulip mania' in 17 th century Amsterdam was inspired by the spiralling price of tulip futures). [38] For the spread bet or CFD trader, it helps to know what prices are driving the prices of the positions you are taking, and to keep any eye on what is happening to the prices of futures contracts further out than the next couple of contracts to expire. [38]
Beyond commodities and indices, many other spread bet and CFD prices are determined by underlying futures prices. They may not precisely track these markets, but their overall movement will be similar. Other markets include futures based on the price of government bonds, particularly the larger markets like U.S. 10 year Treasury bills or Japanese government bonds (JGBs). [38] Futures touched $113.48, the highest intraday price since Sept. 22, 2008. [23]
The average price for the Organization of Petroleum Exporting Countries' basket of 12 reference crudes dropped to $119.38/bbl on Apr. 25 from $119.46/bbl on Apr. 21. [28] In London, the June IPE contract for North Sea Brent crude dropped 33¢ to $123.66/bbl. [28] Aramco would account for over a quarter of that, spending roughly $125 billion on domestic and international projects. This spending includes new crude increments, refining and petrochemical facilities, Falih said. [36]
BrightSource Energy Inc.''' s plan to raise $250 million in an initial public offering may advance its goal to use solar- thermal technology across the southwest U.S. at generators with the equivalent capacity of 11 atomic plants. [46] Distillate fuel supplies were taken down by 1.8 million barrels, according to the Energy Department. [18] '''Under normal circumstances a crude build of over 6 million barrels and a big increase in imports would be enough to send us much lower. [39] Over the last four weeks imports have averaged 8.70 million barrels per day, which were 724,000 barrels per day below the same four-week period last year. [19] Stockpiles are up more than 27 million barrels since the beginning of the year. [42]
Stockpiles were forecast to increase 1.7 million barrels, according to the median of 13 estimates in a Bloomberg News survey. [10] Traders were also cautious ahead of weekly inventory data, which was forecast in a Reuters poll to show a 1.0 million barrel increase last week. [9] The API estimated a build of 1.5 million barrels, while the Street forecast an increase ranging between 100,000 and 650,000 barrels. [18]
Gasoline stockpiles are expected to have decreased 1 million barrels from 208 million. [34] Late Tuesday, the American Petroleum Institute had estimated the national stockpile increased by 4.9 million barrels, while analysts expected a build between 800,000 and 1.7 million barrels. [18] Cushing stockpiles declined 770,000 barrels to 41 million barrels, the biggest drop since April 2. [5]
Inventories dropped 770,000 barrels to 41.1 million in the week ended April 15, the Energy Department said on April 21. [15] Even when producing 9 million b/d, Saudi Arabia still left "a significant deficit at the margin of the market with inventories falling faster than normal, even before Libyan exports came off the market," said Paul Horsnell, Barclays Capital's managing director and head of commodities research. "Allowing for a normal second quarter global inventory build and replacing lost volumes from elsewhere seems likely to require Saudi Arabia to move up to 10 million b/d, in conjunction with higher volumes from the other holders of spare capacity (Kuwait, UAE, and Qatar)," he said (OGJ Online, Apr. 4, 2011). [26] The uprisings have not yet reached Saudi Arabia, the world'''s largest oil producer, but Saudi forces have intervened militarily to support the ruling family in neighboring Bahrain.'' [50] Saudi Arabia, the world'''s largest oil exporter, will continue to act in support of market stability and as a force for moderation, Saudi Aramco Chief Executive Officer Khalid al- Falih will say in Seoul today. [46]
Yemen shares a border with Saudi Arabia and ranks as the ninth-biggest crude producer in the Middle East, according to BP Plc. [5]
'''It'''s no secret the Saudis don'''t want prices higher, especially with a weaker dollar, because it puts the global economy into question and threatens Saudi long-term market share for energy,''' said Stephen Schork, president of the Schork Group Inc. in Villanova, Pennsylvania. [23] There are other factors in the price of oil that are not discussed in the Energy Information Administration'''s brief.'' Chief among these is the Obama Administration'''s moratorium on off-shore drilling.'' [50] U.S. Energy Information Administration oil inventory data is due at 10:30 a.m. EDT (1430 GMT) on Wednesday. [2] Traders await inventory data from the U.S. Energy Information Administration, usually seen as more definitive than the API report, that will be released on Wednesday at 10:30 a.m. EDT (1430 GMT). [9]
Voting will take place in 26 of 36 states to elect legislatures and governors, with the number of states under the control of the ruling People'''s Democratic Party likely to shrink. Nigeria is the fourth-biggest source of U.S. crude imports so far this year, according to the Energy Department. [43] Stocks are starting to trend into a deficit to the levels of the last 2 years and are trending towards the 2007 levels. In early February, U.S. total petroleum stocks were 30 million bbl above the 2010 levels; they are now 29 million bbl below (OGJ Online, Apr. 21, 2011)." [26] Stocks of the motor fuel fell in spite of EIA data that showed domestic demand fell by 1.6 percent on average over the last four weeks from the levels of a year ago. [6]
Coming up: EIA stocks data, 10:30 a.m. EDT, Wednesday (Recasts, updates prices, market. [9]
"Moreover," Sen said, "current oil demand boasts of significantly altered global income and price elasticities. [30] The most recent oil shock occurred in the summer of 2008. Oil shocks typically cause a decline in the demand for oil as prices rise, but they also cause a decline in the demand for other goods and services as well.'' The reason for this is two-fold.'' If consumers are spending more at the pump, they have less money to spend on other things.'' [50] A softer greenback will make dollar-priced oil cheaper, boosting demand and leading to higher prices. [12]
A weaker dollar can lift oil prices by attracting investment seeking better returns and making oil and other denominated commodities attractive as a hedge against inflation. [1] Earlier, oil jumped as gold and silver climbed to records and other commodities advanced as alternative investments to a weakening U.S. dollar. Precious metals also surged on speculation that China will increase purchases to diversify its foreign-exchange reserves. [15] Again, the courts found in favor of the oil companies and agreed that the new rules issued after the ban was lifted imposed an informal moratorium.'' The government continued its policy of delaying permits and was found in contempt by a U.S. district judge in February 2011.'' [50]
Members of the Organization of Petroleum Exporting Countries have not replaced oil production lost to the conflict in Libya, creating a 1 million b/d shortage last month. [30] Syrian troops tightened control over flash points of protest against President Bashar al-Assad, who faced growing international calls to end violence that a rights group said had killed over 450 people. Iran plans to preserve its current level of oil and gas production, Oil Minister Masoud Mirkazemi was quoted as saying by the Aftab newspaper. [2]
Saudi production fell by 800,000 bbl in March, "coinciding with a fall in demand from Japan after last month's devastating earthquake," said analysts in the Houston office of Raymond James & Associates Inc. [30] CGES analysts emphasized, "Oil demand cannot continue to grow over time without the supply to satisfy it. [30] '''Fears about loss of supply could still push prices higher,''' Roland Stenzel, an oil trader at E&T; Energie Handelsgesellschaft mbH, said today from Vienna. [34] The increase in the supply of available oil on the market drives the price down.'' [50]
'''There is plenty of supply and enough spare capacity,''' said Gerrit Zambo, an oil trader at Bayerische Landesbank, by phone from Munich today. [17] In the last six weeks, we've had a change: A rapid move of the curve to become much flatter and in some places to reverse and become backwardated. Backwardated curves tend to be more supply sensitive - the bets in this market are more often engaged to protect against a rapid destruction of supply choices in the near term. It will therefore make sense to you that the most intense backwardated oil market will emerge as the Middle East becomes disrupted and as Western forces threaten to intervene militarily. [44] Oil supplies are being reduced by the disruption of Libyan oil exports and the continuing unrest in the Middle East. [50] Distillate fuel supplies, including diesel and heating oil, were estimated to have increased by 600,000 barrels. [43]
Kinder Morgan Energy Partners LP apportioned shipments on its Trans Mountain oil pipeline by 60 percent for April, after it was shut last week following a leak. [46] Ethanol rose. Suncor Inc. has completed a turnaround at its Commerce City refinery in Colorado and the plant is operating normally, according to a statement on the company'''s website. Kinder Morgan Energy Partners LP is starting a portion of its 300,000-barrel-a-day Trans Mountain oil pipe that was shut April 22 due to a leak, and expected to resume shipments to Washington refiners later today. [46]
"The oil market has been fairly flat, there's not really been a whole lot of movement," said Victor Shum, a Singapore-based analyst with energy consultancy Purvin and Gertz. [12]
Oil also fell as China '''s banking regulator set capital targets for the nation'''s five biggest lenders above the minimum 11.5 percent ratio amid concern that credit risks may rise, three people with knowledge of the matter said. [15] Average daily volume for Nymex WTI futures fell 43.1 percent to 484,612 contracts. [18] You will usually see on your trading screen the next one or two futures contracts on each commodity that is being priced. [38] Prices for the different contracts will be affected by a range of factors, and while your spread bet provider may only quote you the next two contracts, it is sometimes worth keeping an eye on what is happening further out in the trading range to see where the market is expecting prices to go. [38]
RealMoney Silver: Get Doug Kass's exclusive trading diary + 4 of TheStreet's top premium services including Action Alerts PLUS and RealMoney -- all on one streamlined page. Stocks Under $10: Break into the market with small- and mid-cap stocks. all $10 or less! David Peltier tells you exactly which low-priced stocks he's buying and selling. [29] For the U.S., it "implies a stock draw. of 1 million b/d in the second quarter," Jakob said Apr. 21. "For April to date, the U.S. has been reducing its stock layers at a rhythm of 800,000 b/d." In April of 2009 and 2010, he said, "The U.S. was building stocks. [26] Gasoline demand in the U.S. has stayed around 9 million b/d and is running higher year-over-year by 1.3% in the year-to-date. [30] Within the OECD, "especially in the U.S., $4/gal gasoline does represent a psychological barrier, and in the past has been associated with a significant compression in demand," said Amrita Sen, assistant vice-president of commodities research at Barclays Capital. [30]
U.S. motor fuel prices have become a heated political issue after pushing towards $4 a gallon. [22] U.S. Airways Group, the smallest of the U.S. full-fare carriers, posted a wider loss in the first quarter as jet fuel prices surged 33 percent, the Tempe, Arizona-based company said in a statement today. [23] Gold and silver tumbled as players sold amid uncertainty over the direction of U.S. monetary policy, but a softer dollar helped support prices and sentiment. [1] Residential real estate prices dropped by the most in more than a year in February, a sign the U.S. housing market is struggling to stabilize, according to the S&P;/Case-Shiller index of property values in 20 cities. [23] The group's Vienna office was closed Apr. 22 and Apr. 25. This year, OPEC's basket price has averaged $104.55/bbl. [28] If we hit that price, and we breakout above it, then the next psychological level is $200. That's where I am getting my $150 to $200 target from. [29]
Anuj Sharma, research analyst at Pritchard Capital Partners LLC in Houston, said, "The further monetary tightening by China through higher capital adequacy ratios for the country's five biggest lenders also weighed on the crude markets." He observed, "Although the worsening situation in Syria and the ongoing conflict in Libya would keep the geopolitical risk premium embedded in prices, crude is likely to come under pressure on profit taking." [28] "The big build in crude stocks was a major surprise," said Sean Brodrick, a natural resource analyst with Weiss Research in Jupiter, Florida. [10]
A Reuters poll on Monday forecast that gasoline stocks fell last week, which would be the 10th consecutive weekly decline. [1]
The premium of gasoline over heating oil increased to 14.09 cents, the most since March 31, 2010. [4] The cost of shipping a gallon of gasoline, jet fuel or other so-called clean petroleum products from the Middle East to Japan was unchanged at 9.80 U.S. cents yesterday, according to data compiled by Bloomberg. [46] Front-month May reformulated gasoline blendstock, or RBOB, recently traded 0.71 cent, or 0.2%, lower at $3.3643 a gallon. [42]
According to Atlantagasprices.com, local gas prices have risen by almost thirty cents in the past month and by a dollar in the past year.'' [50] A weaker dollar and violent political uprising in the Middle East and North Africa have helped push prices up about 32 percent since mid-February. [16] As more money enters the market each dollar is worth less because price falls as supply increases.'' [50] BTK on Apr 27, 10:46 AM said: The same country that in past crises has had their hand on a hair trigger to increase production when prices rise above 80/bl now says its not sure and there's too much supply. [25] The Arab League approved in advance the North Atlantic Treaty Organization's no-fly zone to protect Libyan rebels, knowing Libya's crude production likely would be disrupted. [26]
Saudi Arabian officials are conflicted as to whether or not they're actually pumping more oil, or less oil, in response to the crisis in Libya. They are certain they're now going to pump less. [25]
"People need to know that there are millions of barrels per day of spare capacity available," Falih said. [36] Repairs are expected to take several days, with crude throughput volumes cut in half in the meantime. They said, "On another note, Holly's Navajo refinery seems to be out of the line of fire--literally--as fears have subsided that it may be impacted by a fast-spreading wildfire in southeastern New Mexico." [28] Although energy ministers and some investment banks claim prices were driven up by speculation, CGES disputed that cause. While speculative long positions may have set new records, the CGES' index of speculative intensity--which measures the volume of 'pure' speculative activity that is not offsetting opposite positions taken by "hedgers"--is close to its lowest point since the beginning of 2007, they said. [30] Crude supplies gained the most in four weeks. The Energy Department will release its Weekly Petroleum Status Report at 10:30 a.m. today in Washington. [17] '''Consumers are becoming more confident and spending is starting to grow more robustly but the housing market is still very weak,''' said Ben Westmore, a minerals and energy economist at National Australia Bank Ltd. in Melbourne. '''That'''s likely to be a big headwind to growth ahead, and as a result, a bit of a headwind to demand for crude.''' [17]
There is a lot that we can do to curb speculation, but the claim that rising gas prices are not based on supply and demand is simply not true. [47] SINGAPORE (Dow Jones)--Crude-oil futures were higher Monday, supported by weakness in the dollar, while geopolitical uncertainty in Yemen added to supply concerns. [13] Futures slipped today as the S&P;/Case-Shiller index of property values in 20 cities fell 3.3 percent from February 2010, outweighing a gain in the Conference Board's confidence index. [3] The ICE coffee futures contract is priced for delivery in March, May, July, September and December. [38] The contract previously hit an intraday high of $113.48, the highest trade in two and a half years. [37]
The premium has shrunk $2.25 from a week earlier on signs that supplies are falling at Cushing, Oklahoma, the delivery point for West Texas Intermediate grade. [5]
The Federal Reserves FOMC begins first day of two-day meeting on monetary policy. [1] Traders are mulling how the Federal Reserve may ease a program of buying Treasuries known as quantitative easing that has helped keep the U.S. economy flush with cash. [16]
U.S. refineries ran at 82.7 percent of total capacity on average, up 0.2 percentage point from the prior week. [7]
SOURCES
1. NYMEX-Crude edges up eyeing Fed meeting, inventory | Reuters
2. NYMEX-Crude edges up, choppy awaiting data, Fed | Reuters
3. Oil Trades Near One-Week Low on Demand Concern Over U.S. Economy
4. Gasoline Extends Gain as Crude, Heating Oil Drop: Oil Products - Bloomberg
5. Crude Oil Climbs a Fourth Day as Middle East Violence Escalates - Businessweek
6. US crude oil stocks rise 6.2 mln bbls on imports jump-EIA | Energy & Oil | Reuters
7. Crude oil supplies climb by 6.2 million barrels - Forbes.com
8. Saudi Arabia 'Not Comfortable' With Oil Price, Al-Falih Says - Businessweek
9. UPDATE 1-NYMEX-Crude off, awaits Fed decision, data | Reuters
10. Crude Oil Falls as U.S. Supplies Climb the Most in Nine Months - Businessweek
11. Oil Prices Continue - WSJ.com
12. Oil prices drop in Asian trade
13. OIL FUTURES: Crude Higher In Asia; Dollar Down Before Fed Meet - WSJ.com
14. Oil in New York Erases Earlier Loss; Brent Crude Rises in London - Businessweek
15. Crude Oil Falls From 31-Month High as U.S. Equities Drop, Dollar Rebounds - Bloomberg
16. Oil Falls to Near $111 as US Dollar Strengthens - ABC News
17. Oil Trades Near One-Week Low as Rising Stockpiles Signal Slow Fuel Demand - Bloomberg
18. More Oil Nationally, Less In Oklahoma - Seeking Alpha
19. U.S. Crude Inventories Up Amid Higher Imports Last Week - EIA
20. Crude Steady Above $112 Ahead Of Official Inventories Data, FOMC
21. OIL FUTURES: Crude Drops As Data Show Large Inventory Rise - WSJ.com
22. Brent oil pares gain on U.S. inventory rise-UPDATE 5 00:44 Hours ago
23. Crude Oil Slips for a Second Day on Concern High Prices to Curb Expansion - Bloomberg
24. AFP: Aramco says to boost refining capacity by 50%
25. Saudi Arabia Can't Figure Out If It's Pumping More Oil Or Not
26. OPEC members, industry analysts differ over oil supplies - Oil & Gas Journal
27. Roundtable: High oil prices threaten recovery - Oil & Gas Journal
28. MARKET WATCH: Crude price closes flat in low trading volume - Oil & Gas Journal
29. 8 Stocks for the Coming Oil Sands Boom - TheStreet
30. High prices despite oversupply - Oil & Gas Journal
31. Brent turns higher in choppy trade after EIA data | Energy & Oil | Reuters
32. Brent, U.S. crude pare in choppy trading after data | Energy & Oil | Reuters
33. US crude turns up, Brent up $1 on fuel stocks drop | Energy & Oil | Reuters
34. Crude Rises as Europe Economic Data Boost Demand Optimism, Pressure Dollar - Bloomberg
35. OIL FUTURES: Crude Eases Ahead Of FOMC; Gasoline Strong - WSJ.com
36. UPDATE 4-Saudi uneasy with high oil price, worried about economy | Reuters
37. OIL FUTURES: Crude Turns Lower As Dollar Pares Losses - WSJ.com
38. Futures Trading - Investment International
39. Crude Oil Futures Increase After Report Shows U.S. Fuel Stockpile Decline - Bloomberg
40. AFP: Oil prices stable, close to $124
41. Oil Prices Seesaw Before Fed - TheStreet
42. US OIL INVENTORIES: Crude Stocks Rise By 6.2 Million Barrels
43. Oil Trades Near 31-Month High in New York, Paring Loss as Equities Advance - Bloomberg
44. Could The Oil Market Be A War Predictor?
45. OIL FUTURES: Gasoline Futures Hit Multiyear High; Oil Flat - WSJ.com
46. TOP Oil Market News: Saudi Arabia '''Not Comfortable''' With Price - Bloomberg
47. Northwest Voices | No shortage of crude oil by OPEC | Seattle Times Newspaper
48. U.S. Crude futures fall more than $1 to $111.25/bbl | Reuters
49. EIA Report… - Forex
50. Why gas prices are going up - Atlanta Conservative | Examiner.com
51. OIL FUTURES: Nymex, Brent Turn Positive As Dollar Weakens - WSJ.com
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