Commodity Corner: Crude Slips Below $80

- Commodity Corner: Crude Slips Below $80

Tuesday, August 09, 2011
Rigzone Staff
by Saaniya Bangee

Crude oil futures extended losses Tuesday after the Federal Reserve said risks to the economic outlook have increased.

Light, sweet crude continued to retreat on the New York Mercantile Exchange Tuesday settling at $79.30 a barrel, down $2.01. For the first time in nearly 10 months, crude prices settled below $80 a barrel.

The Fed failed to ease fears as Chairman Ben S. Bernanke and his colleagues promised to extend the benchmark interest rate for another two years but stopped short of initiating an additional round of economic stimulus.

In separate monthly reports, the U.S. Energy Information Administration (EIA) and OPEC cut demand forecasts for 2011. The EIA cut its 2011 world demand growth forecast by 60,000 barrels per day (bpd). It raised its 2012 projections to 1.64 MMbpd. Meanwhile, OPEC cut oil demand growth for this year by 150,000 bpd and 20,000 bpd for next year.

The intraday range for crude was $75.71 to $83.05 a barrel.

At its lowest close since Feb. 18, Brent futures lost $1.17 to end Tuesday's trading session at $102.57 a barrel. Prices traded as low as $99.06 and as high as $105.81 Tuesday.

Gasoline for September delivery settled 2.4 cents lower at $2.67 a gallon Tuesday. The EIA reported a 2 percent decline in gasoline demand over the summer-driving season, pushing prices as low as $2.59. The intraday high for gasoline was $2.76.

Conversely, natural gas futures gained 5.9 cents, or 1.5 percent, settling at $3.99 per thousand cubic feet. Natural gas futures pushed past the $4-mark Tuesday, peaking at $4.04 and bottoming out just below $3.89. High temperatures continue to support gains.

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Commodity Corner: Oil Settles Below $100

Commodity Corner: Oil Settles Below $100

Thursday, May 05, 2011
Rigzone Staff

Crude oil for June delivery plummeted more than eight percent Thursday and settled below $100 for the first time since March 16.

The commodity settled at $99.80 a barrel, a $9.44 decline from Wednesday. The sharp drop stems from a stronger U.S. dollar and concerns about economic growth on both sides of the Atlantic.

In the U.S., the federal Department of Labor announced that first-time claims for jobless benefits increased last week by just under 10 percent to 474,000. Meanwhile, Germany's Ministry of Economics and Technology announced that the country's factory orders fell by four percent in March—a dramatic shift from a two-month growth trend. Crude oil traded within a range from $98.25 to $109.38 Thursday.

The price of June natural gas also followed a downward slope Thursday, losing nearly 32 cents to settle at $4.26 per thousand cubic feet. Driving the decline was the U.S. Energy Information Administration's weekly report on natural gas inventories.

According to the EIA, working gas in underground storage rose to 1,757 billion cubic feet as of last Friday. The 72-Bcf week-on-week increase was higher than expected; analysts surveyed by Platts, for instance, had predicted a more modest build of 64 to 68 Bcf for the period.

Front-month natural gas peaked at $4.57 and bottomed out at $4.25 Thursday.

Gasoline also ended the day lower, falling 23 cents to settle at $3.095. June gasoline fluctuated from $3.335 to $3.06.

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