Commodity Corner: Oil Falls as Euro Weakens

- Commodity Corner: Oil Falls as Euro Weakens

Friday, September 09, 2011
Rigzone Staff
by Matthew V. Veazey

Light sweet crude oil for October delivery fell below $86.00 a barrel Friday as the U.S. dollar strengthened against the euro.

The WTI bottomed out at $85.64 a barrel before settling at $87.24, still reflecting a day-on-day loss. It peaked at $89.50. The Brent contract price also ended the day lower, settling at $112.77 after trading within a range from $111.09 to $113.89.

A weaker greenback is bullish for crude oil—priced in dollars—because it becomes a better buy for investors holding other currencies. In the case of the euro Friday, the currency weakened amid mounting fears that Greece will default on its debt. The departure of a high-level German official from the European Central Bank Friday contributed to speculation that euro-zone countries will fail to resolve lingering policy disputes that have hindered efforts to resolve debt crises throughout the region.

Equities fell as the euro-zone uncertainty grew, chilling expectations about global demand for oil. The Dow Jones Industrial Average and S&P 500 each lost approximately 2.7 percent while the Nasdaq lost a relatively modest 2.4 percent. President Obama's latest plan to spur job creation in the U.S., presented Thursday night to a joint session of Congress, failed to brighten the demand outlook.

October natural gas also ended the day lower, falling to $3.915 per thousand cubic feet. Gas futures fluctuated from $3.885 to $3.99 during Friday's floor trading.

Front-month gasoline settled at $2.77 a gallon, slightly higher than the $2.76 intraday low. October gasoline peaked at $2.89 Friday.

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Commodity Corner: Oil Follows Stocks' Lead

- Commodity Corner: Oil Follows Stocks' Lead

Wednesday, September 07, 2011
Rigzone Staff
by Matthew V. Veazey

Thanks to a German court ruling supporting bailouts in the euro-zone, world equities markets posted healthy gains Wednesday. The WTI and Brent crude oil benchmarks followed suit.

Light sweet crude oil for October delivery gained nearly four percent to end the day at $89.34 a barrel. Brent, meanwhile, climbed 2.7 percent to settle at $115.80 a barrel. Buoying stock markets on both sides of the Atlantic as well as Asia was the German Constitutional Court's rejection of an attempt to block German involvement in bailouts of other euro-zone countries.

The Dow Jones Industrial Averaged gained nearly 2.5 percent while the S&P 500 and Nasdaq rose by 2.86 percent and 3.04 percent, respectively. In Europe, the London-based FTSE 100 finished more than 3.1 percent higher and the CAC 40 in Paris gained 3.63 percent. Major exchanges in Shanghai, Tokyo, and Hong Kong posted more modest increases.

The WTI traded within a range from $86.15 to $89.74 while the Brent contract price fluctuated from $112.81 to $115.98.

Natural gas for October delivery managed to break the $4.00 mark, peaking at $4.04 per thousand cubic feet. The midweek momentum faded by the close of floor trading, however, with the front-month contract settling at $3.94 for the second straight day.

October natural gas bottomed out at $3.90 Wednesday.

The price of a gallon of gasoline gained nearly nine cents to settle at just under $2.91, also the intraday high. The price floor during Wednesday's trading was $2.82.

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Commodity Corner: Oil Edges Lower on Econ Woes

- Commodity Corner: Oil Edges Lower on Econ Woes

Tuesday, September 06, 2011
Rigzone Staff
by Saaniya Bangee

Light, sweet oil edged lower Tuesday on lingering concerns about the global economy.

Oil futures traded 43 cents lower at $86.02 a barrel on the New York Mercantile Exchange.

Concerns that the European debt crisis might worsen pushed prices and equities lower Tuesday. Traders worry that the economic plague could spread to neighboring countries.

Prices fell as low as $83.20 a barrel in intraday trading as U.S. stock indexes plummeted for a third consecutive session. They peaked at $86.50. Earlier today, the Dow Jones Industrial Average fell 308 points but rebounded after the Greek government indicated swifter economic reforms.

Traders are waiting to take cues from President Obama and the Federal Reserve's speech later this week.

Brent crude, which is used to price many international oil varieties, gained $2.81 Tuesday to settle at $112.89 a barrel. Brent took its cues from production problems in the North Sea and a continued absence of Libyan oil in the market.

Likewise, natural gas for October delivery added 6.6 cents to settle at $3.94 per thousand cubic feet. Prices fluctuated between $3.85 and $3.95 Tuesday.

The U.S. National Hurricane Center reported that a new weather system west-southwest of the Cape Verde Islands had a 90 percent chance of becoming a cyclone in the next 48 hours.

After trading between $2.77 and $2.84, front-month gasoline lost 1.7 cents to settle down at $2.82 a gallon.

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Commodity Corner: Crude Up on Weather Threat

- Commodity Corner: Crude Up on Weather Threat

Thursday, September 01, 2011
Rigzone Staff
by Saaniya Bangee

Despite shaky equities and a rising dollar, crude futures inched modestly higher Thursday on weather reports of a storm brewing in the Gulf of Mexico.

October oil added 12 cents to its final price tag, settling at $88.93 a barrel on the New York Mercantile Exchange. Oil traded as low as $88.21 a barrel after an earlier intraday peak of $89.90.

The National Hurricane Center reported an 80 percent chance that a tropical wave in the Gulf of Mexico could develop into a tropical cyclone within the next 48 hours. Oil majors such as Shell, ExxonMobil, BP, Anadarko and BP have evacuated nine platforms in the Gulf of Mexico and shut in nearly 80,000 barrels of oil production, according to the Bureau of Ocean Energy Management, Regulation and Enforcement. In addition, 127 million cubic feet per day of natural gas was also shut in.

In other forecasts, initial unemployment claims fell by 12,000 to 409,000 last week. Data reported by the Labor Department helped boost optimism about the economy.

Brent crude, which is used to price many international oil varieties, lost 56 cents to settle lower at $114.29 barrel on fresh concerns over Greece's debt problems. The intraday range for Brent was $113.89 to $115.31 a barrel on the ICE future exchange.

Natural gas for October delivery remained unchanged at $4.05 per thousand cubic feet Thursday.

Gasoline gained 1.64 cents for the first trading session for the October contract. Reformulated gasoline settled at $2.89 a gallon. Some East Coast refineries remain shut down due to Hurricane Irene. Prices fluctuated between $2.85 and $2.92 Thursday.

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Commodity Corner: WTI, Brent Settle Higher

- Commodity Corner: WTI, Brent Settle Higher

Tuesday, August 30, 2011
Rigzone Staff
by Matthew V. Veazey

The WTI and Brent crude oil benchmarks settled higher Tuesday after the Federal Reserve left investors contemplating whether the central bank will try yet again to shore up the sagging U.S. economy.

Light sweet crude oil gained $1.63 to settle at $88.90 a barrel while the Brent picked up $2.14 to end the day at $114.02 a barrel after the Fed released the minutes of the August 9, 2011, joint meeting of the Federal Open Market Committee and the Federal Reserve Board of Governors. The minutes reveal support among some members for more monetary action to spur economic growth.

One possible Fed move, which the central bank has initiated twice since the 2008-2009 financial crisis, is quantitative easing. The approach calls for the Fed's purchase of U.S. Treasury bonds so that banks would have more money available to lend to businesses and consumers.

Both "QE1" and "QE2" yielded a weaker U.S. dollar, which in turn was bullish for crude oil. When the dollar weakens, oil—priced in greenbacks—becomes a better value for investors holding other currencies. The minutes show that the Fed voted to extend its September meeting to two days rather than one, giving it more time to consider the merits of "QE3" and any other options remaining at its disposal.

Also boosting oil was the development of Tropical Storm Katia in the eastern Atlantic Ocean. Located approximately 750 miles west of the Cape Verde Islands late Tuesday, Katia was moving toward the west-northwest at 20 miles per hour. The National Hurricane Center expects the storm to be a major hurricane by Saturday afternoon, when it should be centered to the east of the Lesser Antilles.

During Tuesday's floor trading, the WTI fluctuated from $86.46 to $89.21. The Brent peaked $114.20 and bottomed out at $111.22.

Natural gas for October delivery settled at $3.91 per thousand cubic feet, up a nickel from the final price for the now-expired September contract. October natural gas traded within a range from $3.78 to $3.92.

September gasoline gained nine cents to end the day just under $3.00 a gallon. The futures price fluctuated from $2.897 to $3.00.

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Commodity Corner: Ben, Irene Contribute to Volatility

- Commodity Corner: Ben, Irene Contribute to Volatility

Friday, August 26, 2011
Rigzone Staff
by Matthew V. Veazey

The price of a barrel of light sweet crude oil experienced some volatility Friday before settling at $85.37, or just seven cents day-on-day.

The WTI fell as low as $82.95 after Federal Reserve Chairman Ben Bernanke, speaking at a symposium in Jackson Hole, Wyo., did not announce any Fed plans to launch a third round of quantitative easing. A "QE3" would be bullish for oil and other commodities because it would weaken the U.S. dollar.

Hurricane Irene's pending arrival along the East Coast did create upward momentum for the benchmark, however. The WTI peaked at $85.64 as investors weighed the possible effects the storm may have on refining infrastructure and gasoline supplies in the Mid-Atlantic and Northeast.

The Brent contract price also settled higher Friday, gaining 74 cents to end the day at $111.36 a barrel. It traded within a range from $109.38 to $111.65.

Despite Irene's potential impact on East Coast fuel supplies, reformulated gasoline lost four cents to settle at $2.93 a gallon. The U.S. Coast Guard's lack of a decision during floor trading to close New York Harbor prevented a bullish outcome Friday.

September gasoline peaked at $2.98 and bottomed out at $2.91 during the pre-storm session.

Natural gas for September delivery settled flat at $3.93 per thousand cubic feet. It fluctuated from $3.90 to $3.96.

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Commodity Corner: Irene Supply Fears Propel Oil, Gasoline

- Commodity Corner: Irene Supply Fears Propel Oil, Gasoline

Thursday, August 25, 2011
Rigzone Staff
by Matthew V. Veazey

Light sweet crude oil gained 14 cents Thursday amid fears that Hurricane Irene could diminish gasoline supplies along the East Coast.

The WTI ended the day at $85.30 a barrel after fluctuating from $83.01 to $86.56. The major hurricane, which is expected to hit North Carolina's Outer Banks Saturday evening, could cause widespread power outages, flooding, and wind damage from the Carolinas to New England. Six refineries with approximately 1.3 million barrels of processing capacity lie within the storm's projected path. Pipelines and terminals serving those facilities could also be impaired should Irene remain on her current track.

As of 5 p.m. EDT Thursday, Hurricane Irene was packing maximum sustained winds of 115 miles per hour. The storm, centered over the Bahamas at press time, was moving north-northwestward at 14 mph.

The Brent contract price also settled higher Thursday, gaining 47 cents to end the day at $110.62 a barrel. It peaked at $111.38 and bottomed out at $109.05.

Buoyed by the threat of Irene, gasoline for September delivery rose nine cents to end the day at $2.97 a gallon. It traded within a range from $2.88 to 2.97.

September natural gas edged upward by one cent to settle at $3.93 per thousand cubic feet. The front-month contract fluctuated from $3.87 to $3.98.

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Commodity Corner: Brent Falls on Libyan Woes

- Commodity Corner: Brent Falls on Libyan Woes

Monday, August 22, 2011
Rigzone Staff
by Saaniya Bangee

With Libya's six-month conflict nearing an end, crude futures rose 2.3 percent Monday. On Monday, Libyan rebels announced they had taken control of a majority of the country's capital, advancing in efforts to oust leader Moammar Gadhafi.

Light, sweet crude for September delivery gained $1.86 to settle at $84.12 a barrel. Priced traded as low as $81.13 a barrel, after an earlier intraday peak of $84.67. The front-month contract expired at the end of the floor trading session.

Brent, which serves as a barometer for international oil, fell 36 cents on expectations that Libyan oil exports could resume fairly soon. Prior to the civil war, Libya exported 1.3 million barrels a day of high-quality oil. Supply disruptions in Libya and the North Sea have pushed Brent futures past the $100-mark this year. Earlier in the session, Brent futures bottomed out at $105.15 a barrel before settling at $108.26 a barrel.

September natural gas traded 5.1 cents lower at $3.89 per thousand cubic feet Monday on bearish weather forecasts. Forecasts predict a significant drop in temperatures for the upcoming weeks. Higher temperatures boost the demand for natural gas.

In addition, forecasts predict that Hurricane Irene, the first hurricane of this year's Atlantic hurricane season, is unlikely to disrupt vital production areas in the Gulf of Mexico.

The intraday range for natural gas was $3.853 to $3.928 Monday.

Reformulated gasoline blendstock, or RBOB, lost less than a penny Monday to settle at $2.835 a gallon.

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Commodity Corner: Oil Rises on Bullish Gasoline Stocks

- Commodity Corner: Oil Rises on Bullish Gasoline Stocks

Wednesday, August 17, 2011
Rigzone Staff
by Saaniya Bangee

Light, sweet futures held gains of almost 2 percent Wednesday after the EIA reported a sharp decline in U.S. gasoline inventories.

September crude gained nearly a dollar to settle at $87.58 per barrel on the New York Mercantile Exchange. Its European counterpart settled at $110.60 a barrel, up $1.47.

The U.S. Energy Information Administration (EIA) reported a higher than expected drop in gasoline stockpiles, pushing oil prices higher early on in Wednesday's trading session. The EIA said gasoline stockpiles declined by 3.5 million barrels last week to 210.1 million barrels. An increase in gasoline demand suggests refineries require more oil. Meanwhile, the market pared gains when the EIA reported an increase of 4.23 million barrels in oil inventories.

Benchmark West Texas Intermediate traded between $86.65 and $89.00 Wednesday. Brent benchmark peaked at $111.74—the highest since Aug. 4.

In other NYMEX trading, front-month natural gas futures settled at $3.93 per thousand cubic feet after fluctuating between $3.89 and $3.98 Wednesday. Gasoline for September delivery gained 1.65 cents ending the session at $2.89 a gallon. Reformulated gasoline traded as high as $2.93 and as low as $2.86 Wednesday.

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Commodity Corner: Oil Declines on GDP Data

- Commodity Corner: Oil Declines on GDP Data

Tuesday, August 16, 2011
Rigzone Staff
by Matthew V. Veazey

The WTI and Brent contracts settled lower Tuesday after the release of a key European Union economic indicator supported a pessimistic outlook for global crude oil demand.

Light sweet crude oil for September delivery lost $1.23 to end the day at $86.65 a barrel while Brent slipped 44 cents to settle at $109.47 a barrel. Eurostat, the statistical arm of the EU, on Tuesday announced that gross domestic product throughout the bloc rose by only 0.2 percent in the second quarter. GDP growth during the first quarter was a more robust 0.8 percent; however, Eurostat pointed out that the latest second quarter figure beats that of the corresponding period in 2010 by 1.7 percent.

The WTI contract price fluctuated from $85.62 to $87.93 during Tuesday's session.

Front-month natural gas lost nine cents to settle at $3.93 per thousand cubic feet. Forecast models show milder temperatures from the Midwest to the Northeast through the remainder of this month, chilling cooling demand projections for the regions.

The September natural gas contract traded within a range from $3.90 to $4.04 Tuesday.

The price of a gallon of reformulated gasoline fell two cents to end the day at $2.85. September gasoline peaked at $2.87 and bottomed out at $2.83.

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Gas Prices Fall $0.10

- Gas Prices Fall $0.10



Aug 12, 2011

Oil prices continued to fall during the week but gasoline prices are taking bit longer to catch up.

Some motorists saw some relief as the national average of self-serve regular gasoline fell today to $3.60 a gallon, down $0.10 from $3.70, according to AAA.

The prices of oil fell around $82 a barrel this week as anxiety increased over the European debt crisis and mounting evidence that the economy in the U.S. is slowing once again.

Many oil analysts claimed for months that oil prices were overpriced, based on market fundamentals.

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Commodity Corner: WTI, Brent Rebound

- Commodity Corner: WTI, Brent Rebound

Wednesday, August 10, 2011
Rigzone Staff
by Matthew V. Veazey

Light sweet crude oil on the New York Mercantile Exchange rebounded Wednesday after the U.S. Department of Energy reported that inventories fell last week, catching investors off-guard.

The September WTI contract price gained $3.59 to settle at $82.89 a barrel. The Energy Information Administration (EIA) announced that commercial crude stocks declined by 5.2 million barrels last week to 349.8 million barrels. The 1.5-percent week-on-week draw starkly contrasted to the prediction of a Platts survey of analysts: a 1.8 million-barrel build for the period.

Brent futures also surged Wednesday, settling $4.11 higher at $106.68 a barrel. The WTI traded within a range from $79.53 to $82.90. The contract price for Brent fluctuated from $103.47 to $106.55.

EIA also reported Wednesday that reformulated gasoline inventories declined by a larger-than-expected volume last week: 1.6 million barrels. The 213.6 million barrel EIA figure for the week ending August 5, 2011, was 400,000 barrels below what a Platts survey of analysts had projected.

Front-month gasoline gained 11 cents to end the day at $2.78 a gallon. The September contract price peaked at $2.79 and bottomed out at $2.68.

Natural gas for September delivery edged upward by less than a penny to settle at $4.00 per thousand cubic feet. The contract price fluctuated from $3.98 to $4.08.

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Commodity Corner: WTI, Brent Futures Plummet

- Commodity Corner: WTI, Brent Futures Plummet

Monday, August 08, 2011
Rigzone Staff
by Matthew V. Veazey

On the first trading day after Standard & Poor's downgraded the United States' long-term credit rating from AAA to AA+, the WTI settled at its lowest point in nearly nine months.

Light sweet crude oil lost $5.57 to end the day at $81.31 a barrel—just six cents higher than the Nov. 23, 2010, settlement price. Concerns that the U.S. is slipping into a double-dip recession have dampened expectations about oil demand. Equity markets also sustained significant losses Monday. The Dow Jones Industrial Average fell 5.55 percent while the S&P 500 declined nearly 6.7 percent.

The Brent futures price also plunged Monday but to a somewhat more modest degree than the WTI. It ended the day at $103.47, marking a $5.63 decline from Friday.

The WTI peaked at $85.73 and bottomed out at $80.17 while the Brent traded within a range from $102.88 to $106.92.

Also reflecting fears about slumping demand was the price of gasoline for September delivery, which lost 4.1 percent to end the day at $2.69 a gallon. Front-month gasoline traded within a range from $2.80 to $2.67 Monday.

September natural gas remained relatively steady Monday, losing less than one cent to settle at $3.935 per thousand cubic feet. Natural gas peaked at $3.97 and bottomed out at $3.855.

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Commodity Corner: Oil Takes a Wild Ride

- Commodity Corner: Oil Takes a Wild Ride

Friday, August 05, 2011
Rigzone Staff
by Matthew V. Veazey

After settling at its lowest point in six months Thursday, light sweet crude oil for September delivery managed to eke out a small gain for the day.

The WTI settled at $86.88 a barrel, representing a 25-cent day-on-day increase, after a volatile trading session. The benchmark plunged to an intraday low of $82.87 on escalating debt crisis fears within the eurozone.

Italy is the latest EU country to risk defaulting on its massive public debt. Making debt service less manageable is Italy's stagnant economic growth rate. A possible Italian bailout, along with other debt restructuring initiatives elsewhere in the eurozone, has caused the region's currency to lose value; in this situation, dollar-denominated crude oil becomes a less attractive buy for investors holding the euro.

Investor sentiment brightened later Friday, however, amid reports that Italy's government plans to take steps to jump-start economic growth. The economic liberalization program reportedly includes measures such as amending the country's constitution to require a balanced budget, loosening certain employment rules, and accelerating the pace of entitlement reform.

Also giving oil a boost Friday was a U.S. Labor Department report stating that non-farm payrolls increased by 117,000 last month, beating economists' expectations. Also, the agency announced that the official unemployment rate edged downward in July by 0.1 percentage point to 9.1 percent.

The WTI peaked at $86.88 Friday. The September Brent contract price gained $2.12 to end the day at $109.37 a barrel. It fluctuated from $105.69 to $109.90.

Natural gas for September delivery ended the day flat at $3.94 per thousand cubic feet. It traded within a range from $3.90 to $3.98.

September gasoline climbed nearly seven cents to end the day at $2.805 a gallon. The front-month contract peaked at $2.82 and bottomed out at $2.68.

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Commodity Corner: Crude Dives to 6-Month Low

- Commodity Corner: Crude Dives to 6-Month Low

Thursday, August 04, 2011
Rigzone Staff
by Saaniya Bangee

Crude oil futures plunged nearly 6 percent Thursday to its lowest settlement since February. Prices pushed lower $5.30, marking the largest one-day drop since May 5, as equity markets sold off.

Light, sweet crude settled at $86.63 a barrel on the New York Mercantile Exchange (NYMEX), down for the fifth consecutive session. Its counterpart settled at $107.25 a barrel amid Europe's sovereign debt crisis. Brent crude traded within a range of $107.05 and $113.60 Thursday.

Largely steered by growing concern that the U.S. economy is experiencing a double-dip recession, equity markets sold-off sharply mid-day Thursday pushing prices further. In addition, the greenback gained against the euro Thursday as the Dollar Index rose by almost 1.5 percent. As the greenback rises, the dollar-denominated commodities becomes expensive for foreign buyers.

Likewise, natural gas futures also tumbled Thursday falling below the $4-mark for the first time since March. Front-month natural gas lost nearly 15 cents to settle at $3.94 per thousand cubic feet. The Energy Information Administration said U.S. natural gas inventory increased by 44 billion cubic feet for the week ended July 29.

Meanwhile, moderate temperature forecasts didn't give the market much support either. Also, the National Hurricane Center reported that Tropical Storm Emily isn't headed toward the Gulf of Mexico.

The intraday range for natural gas was $3.915 to $4.119 per thousand cubic feet.

Gasoline for September delivery dropped 19.41 cents, or 6.6 percent, to end Thursday's trading session at $2.74 a gallon, having traded as low as $2.728 after an earlier intraday peak of $2.94.

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Commodity Corner: Mfg. Data Stoke Oil Demand Fears

- Commodity Corner: Mfg. Data Stoke Oil Demand Fears

Monday, August 01, 2011
Rigzone Staff
by Matthew V. Veazey

The September contract price for light sweet crude oil settled at $94.89 a barrel Monday. The WTI traded within a range from $93.42 to $98.60.

The 81-cent day-on-day loss followed the release of disappointing July manufacturing figures by the Institute of Supply Management (ISM). ISM, which bases its findings on surveys of manufacturing supply managers, reported that the U.S. manufacturing sector expanded at a slower rate in July. The organization's closely monitored Purchasing Manager's Index (PMI) fell from 55.3 to 50.9 from June to July; a value above 50 generally means that the manufacturing sector is expanding.

"Production and employment also showed continued growth in July, but at slower rates than in June," ISM Manufacturing Business Survey Committee Chair Bradley J. Holcomb said in written statement. "The New Orders Index registered 49.2 percent, indicating contraction for the first time since June of 2009, when it registered 48.9 percent." Holcomb also pointed out that export sales were very strong and domestic sales were sluggish last month.

Brent futures edged upward Monday, gaining seven cents to settle at $116.81 a barrel. The Brent contract price peaked at $119.95 and bottomed out at $114.86.

Weather forecast models are projecting above-normal temperatures throughout the eastern half of the U.S. through the middle of next week, and cooling demand is expected to increase as a result. September natural gas gained 4.3 cents to end the day at $4.19 per thousand cubic feet.

A new weather system in the Caribbean could also have an effect on natural gas prices over the next several days. The National Hurricane Center in Miami reported Monday afternoon that a "vigorous" tropical wave has formed near the Lesser Antilles and will likely to develop into a tropical cyclone by the middle of the week. The system, which was moving west-northwestward at 15 to 20 miles per hour at 2 p.m. EDT Monday, would be named Emily if it strengthens into a tropical storm.

September natural gas traded within a range from $4.13 to $4.20 Monday.

Gasoline for September delivery lost a penny Monday to settle at $3.05 a gallon after fluctuating from just under $3.01 to $3.145. The August contract, which expired Friday, settled at $3.11.

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Commodity Corner: Oil Plunges on GDP Report

- Commodity Corner: Oil Plunges on GDP Report

Friday, July 29, 2011
Rigzone Staff
by Matthew V. Veazey

Light sweet crude oil for September delivery lost nearly 2.4 percent Friday after the U.S. Department of Commerce estimated that the real gross domestic product (GDP) grew at an annual rate of only 1.3 percent in the second quarter of this year.

The WTI settled at $95.70 a barrel Friday, down $2.31 from the previous day, after the latest figures from the Commerce Department's Bureau of Economic Analysis (BEA) revealed disappointing real GDP figures for the first half of the year. Real GDP is the monetary value of goods and services produced by labor and property in the United States.

The 1.3 percent figure for the second quarter, an advance estimate, failed to meet private-sector expectations of 1.8 percent, the Commerce Department stated. In addition, the BEA revised its first quarter real GDP figure downward from 1.9 percent to a paltry 0.4 percent.

"Today's first look at GDP in the second quarter confirms what we already knew: The economy isn't growing as fast as it needs to," Commerce Secretary Gary Locke said in a written statement. Locke also implied that the economic situation might improve if Congress and the Administration agree on a plan to increase the national debt by authorizing the federal government to raise its borrowing limit from the current $14.3 trillion. "And every day that we fail to act to lift the debt ceiling and inch closer to default, we threaten our economic progress and job creation," he warned.

Brent futures fell less dramatically Friday, ending the day 0.5 percent lower at $116.74 a barrel after fluctuating from $115.80 to $117.06. The WTI peaked at $97.39 and bottomed out at $94.95.

As of 4 p.m. Central Daylight Time Friday, the center of Tropical Storm Don was approaching the South Texas coast. The storm caused offshore operators to shut in approximately 6.2 percent of current natural gas production in the Gulf of Mexico, according to the Bureau of Ocean Energy Management. However, operators were already sending workers back to offshore installations as early as Friday morning.

Given the minimal impact of the storm offshore, along with an Energy Information Administration report that the country's natural gas inventories grew at a larger-than-expected rate last week, natural gas lost 2.2 percent Friday. The September contract price settled at $4.145 per thousand cubic feet.

Natural gas traded within a range from $4.14 to $4.23.

Gasoline for August delivery settled at $3.11 a gallon, down a penny from Thursday. The intraday range for gasoline spanned from $3.07 to $3.12.

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President Obama Announces 54.5 MPG Fuel Efficiency Standard

- President Obama Announces 54.5 MPG Fuel Efficiency Standard



Jul 29, 2011

President Obama announced an agreement with thirteen major automakers to track the next phase in the Administration's national vehicle program, increasing fuel economy to 54.5 miles per gallon for cars and light-duty trucks by Model Year 2025.

The President was joined by Ford (F), GM (GM), Chrysler, BMW, Honda (HMC), Hyundai, Jaguar/Land Rover, Kia, Mazda, Mitsubishi, Nissan (NSANY), Toyota (TM) and Volvo, which together account for over 90% of all vehicles sold in the United States, as well as the United Auto Workers, and the State of California.

Building on earlier agreements for Model Years 2012-2016 vehicles, which will raise fuel efficiency to 35.5 mpg, the next round of standards will require performance equivalent to 54.5 mpg or 163 grams/ mile of CO2 for cars and light-duty trucks by Model Year 2025.

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Commodity Corner: Oil Falls on EIA Stocks Report

- Commodity Corner: Oil Falls on EIA Stocks Report

Wednesday, July 27, 2011
Rigzone Staff
by Matthew V. Veazey

U.S. commercial crude oil inventories as reported by the Energy Information Administration reversed course last week, catching analysts off-guard and contributing to lower oil prices Wednesday.

Light sweet crude oil for September delivery lost 36 cents to settle at $97.40 a gallon after the EIA reported that oil stocks rose 0.65 percent last week to 354 million barrels. The 2.3 million-barrel week-on-week build contrasted with analysts' expectations; interestingly, analysts surveyed by Platts had predicted a draw of 2.3 million barrels for the period.

Prior to Wednesday's report, EIA had reported seven straight weeks of falling inventories. From May 27 to July 15, oil stocks reportedly declined by 5.9 percent. The Brent benchmark lost 85 cents to end the day at $117.43 a barrel.

The WTI traded within a range from $97.28 to $99.50 while the Brent fluctuated from $117.26 to $118.34.

The newly formed Tropical Storm Don is expected to affect operations somewhat at some Western Gulf of Mexico oil and gas installations as it tracks toward the Texas coastline. However, the National Hurricane Center on Wednesday afternoon was not expecting it to intensify into a hurricane. Front-month natural gas ended the day unchanged at $4.37 per thousand cubic feet.

August natural gas futures peaked at $4.41 and bottomed out at $4.34 during the midweek session.

Gasoline lost a penny to settle at $3.14 a gallon Wednesday. The intraday range for the August contract fluctuated from $3.135 to $3.18.

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Oil Prices Fall As Gasoline Supplies And Pump Prices Rise

- Oil Prices Fall As Gasoline Supplies And Pump Prices Rise



Jul 27, 2011

The price of oil is falling after the government announced the nation's oil and gasoline supplies increased last week.

On Wednesday morning, Benchmark West Texas Intermediate crude for September lost $1.50 to $98.90 per barrel at the New York Mercantile Exchange.

The Energy Department stated that oil inventories increased 2.3 million barrels to 354 million barrels last week. Supplies of gasoline raised to 213.5 million barrels. The demand for gas over the past four weeks remains below year-ago levels.

Prices at gasoline stations rose about half a cent on Wednesday to a national average of $3.698 a gallon which is just about $1 more than a year ago.

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