Commodity Corner: Oil Crosses Century Mark

- Commodity Corner: Oil Crosses Century Mark

Friday, July 22, 2011
Rigzone Staff
by Matthew V. Veazey

Light sweet crude oil for September delivery peaked at $100.19 a barrel Friday, buoyed by news of a draft bailout plan for Greece and other debt-laden EU countries as well as optimism that the U.S. will raise its debt ceiling by August 2.

The WTI ultimately settled at $99.87, representing a 74-cent gain from Thursday. The Brent futures contract, meanwhile, gained $1.16 to end the day at $118.67 a barrel.

On Thursday, eurozone leaders emerged from a meeting in Brussels to unveil a preliminary debt restructuring plan for Greece, Portugal, Ireland, and perhaps other EU countries facing crushing sovereign debts—namely, Spain and Italy. Under the new plan, the countries will have access to European Financial Stability Facility loans at lower interest rates and will have more time—15 years or more—to repay them.

Also boosting crude oil Friday was optimism that the Obama Administration and lawmakers in the Democrat-controlled Senate and GOP-controlled House will be able to reach a deal on raising the U.S. debt ceiling from its current $14.3 trillion level. The U.S. Department of the Treasury has warned that the government could default on its debt obligations beginning August 2 if it does not obtain authority to take on more debt above the current borrowing limit. The Senate did vote Friday to table a House-passed "Cut, Cap, Balance" bill. The bill, which President Obama opposes, would require actual spending cuts in the Fiscal 2012 federal budget, implement a statutory spending cap, and advance a Balanced Budget Amendment to the U.S. Constitution.

The WTI bottomed out at $98.43 during Friday's session while Brent futures fluctuated from $117.59 to $118.78.

The eastern half of the U.S. has been under a so-called heat dome of sizzling temperatures for much of the past week, stoking demand for gas-fired electricity to power air conditioners and fans. The dome is expected to "deflate" somewhat this weekend, and the relatively mild forecast help natural gas futures remain largely unchanged Friday. Natural gas for August delivery gained 0.4 cent to end the day at $4.40 per thousand cubic feet Friday.

Also keeping gas futures in check was a U.S. Energy Information Administration report Thursday showing that working natural gas in storage rose to 2.67 trillion cubic feet as of July 15. The latest figures represents a 60-Bcf net build from the previous week, which fell within analysts' expectations. A Platts survey of analysts had projected a build for the period ranging from 58 to 62 Bcf.

Front-month natural gas traded within a range from $4.37 to $4.47 Friday.

Gasoline for August delivery gained three cents to settle at $3.13 a gallon. The futures price fluctuated from $3.10 to $3.14.

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Commodity Corner: Oil Ends Lower on Greece Debt

- Commodity Corner: Oil Ends Lower on Greece Debt

Monday, June 27, 2011
Rigzone Staff
by Saaniya Bangee

Crude prices slipped lower Monday on an upcoming vote debating Greece's debt crisis.

This week the Greek parliament will vote on a $40 billion austerity package in order to receive another bailout from the European Union and the International Monetary Fund. The budget-cuts could affect other European countries.

Crude for August delivery lost 55 cents Monday settling at $90.61 on the New York Mercantile Exchange. Crude retrieved earlier losses on reports that French banks had agreed to accept slower repayment of Greece's debt. The intraday range for oil was $89.61 to $91.30 Monday.

Oil prices were also pressured by the Commerce Department's reports indicating flat U.S. consumer spending for May.

For the first time in three sessions, Brent crude gained ground. The European benchmark gained 0.8 percent Monday ending the session at $105.99 a barrel. Prices swung between $102.28 and $106.40, responding to each update on the Greek vote.

Front-month natural gas rose 2.7 cents Monday settling at $4.26 per thousand cubic feet. Futures for natural gas increased on weather forecasts predicting above-average temperatures for this week. Prices peaked at $4.28 Monday.

After trading between $2.74 and $2.82, gasoline futures settled at $2.81 a gallon.

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Greece Looks to Open South Gas Corridor Via ITGO Project

- Greece Looks to Open South Gas Corridor Via ITGO Project

Thursday, June 02, 2011
Knight Ridder/Tribune Business News
by A. Badalova, Trend News Agency, Baku, Azerbaijan

The Turkey-Greece-Italy gas pipeline must act as the starting point for the South Gas Corridor for gas supplies from the Caspian region to Europe, Greek Environment Minister Tina Birbili said at a meeting with BP senior representatives, Athens News reported.

Birbili later said after there are additional volumes of gas, other pipelines will be connected.

This position was voiced by the Greek environment minister during a meeting with BP Vice President Alasdair Cook.

Gas produced within the second stage of Shah Deniz's development is regarded as the main source, not only for ITGI project.

The peak production is forecasted at over 9 billion cubic meters and 50,000 barrels of condensate. According to the forecasts, gas production can be brought up to 24 billion cubic meters a year within the second stage of field development.

Shah Deniz reserves are estimated at approximately 1.2 trillion cubic meters of gas.

First gas is expected to be received within the second stage of field development in 2017.

ITGI Transport Corridor includes the renovated Turkish pipeline infrastructure, as well as ITG projects and IGI. Edison (Italy) and Depa (Greece) established IGI Poseidon SA for the design and construction of IGI pipeline, known as Poseidon.

Copyright (c) 2011, Trend News Agency, Baku, Azerbaijan

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