Commodity Corner: WTI Slips; Brent Edges Upward

- Commodity Corner: WTI Slips; Brent Edges Upward

Friday, August 12, 2011
Rigzone Staff
by Matthew V. Veazey

Light sweet crude oil for September delivery surged above $87 Friday but settled well below that on mixed economic news.

The WTI received a boost for much of the day after the U.S. Department of Commerce's Census Bureau on Friday announced that retail sales increased 0.5 percent last month. Moreover, the bureau revised upward sales figures for both May and June by 0.2 percent. In addition, it reported that sales at gasoline stations rose by 1.6 percent in July.

"Consumer spending reflects the confidence of the American people, and despite recent economic turbulence, we're still seeing widespread growth in spending," Acting Commerce Secretary Rebecca Blank said in a written statement.

The WTI peaked at $87.37 a barrel but settled at $85.38, a 34-cent day-on-day loss, after Thomson Reuters and the University of Michigan reported dramatically lower preliminary consumer confidence figures. The sources' widely observed measure of consumer sentiment plunged 13.8 percent from July to August, hitting its lowest point in 31 years.

The WTI peaked at $87.37 and bottomed out at $84.02.

Brent futures eked out a slight, one-cent gain to end the day at $108.03 a barrel after trading within a range from $107.72 to $108.90.

The consumer confidence news also caused front-month natural gas to end the day lower. The September contract price lost a nickel to settle at $4.06 per thousand cubic feet. Natural gas futures fluctuated from $4.14 to $4.055.

September reformulated gasoline lost less than a penny to settle at $2.82 a gallon. The intraday range for gasoline was $2.81 to $2.86.

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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: WTI Slips, Brent Edges Upward

- Commodity Corner: WTI Slips, Brent Edges Upward

Wednesday, July 06, 2011
Rigzone Staff
by Matthew V. Veazey

An announcement by China's central bank Wednesday contributed to a 24-cent drop in the price of light sweet crude oil on the New York Mercantile Exchange.

The WTI settled at $96.65 a barrel Wednesday after the People's Bank of China announced plans to raise interest rates by one-quarter percent to 6.56 percent effective July 7. The bank's action marks the third such hike this year. Brent, meanwhile, barely ended the day in positive territory. It gained a penny to settle at $113.62 a barrel.

The interest rate hike, coupled with lingering concerns about the debt crises in Greece in Portugal, have stoked fears of softening oil demand among investors. Providing some support for oil were expectations that the U.S. Energy Information Administration and American Petroleum Institute will report lower oil stocks Thursday. A Platts survey of analysts projects that EIA and API inventory data will reveal a 2.5 million-barrel draw.

The August WTI contract peaked at $97.79 and bottomed out at $95.90. Brent fluctuated from $112.17 to $113.82.

Expectations that temperatures will moderate over the next two weeks throughout the Midwest and East Coast&mdash chilled the price of natural gas for August delivery Wednesday. The front-month contract lost 14 cents to settle at $4.22 per thousand cubic feet.

Natural gas traded within a range from $4.26 to $4.36.

August gasoline futures ended the day slightly below $3.00 a gallon after fluctuating from $2.94 to $3.00 during the midweek session.

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[Oil and Gas Post] - Oil Slips From Two-Week High on Speculation Mideast Risk Limited to Libya

Oil Slips From Two-Week High on Speculation Mideast Risk Limited to Libya

By Grant Smith and Ann Koh - Mar 22, 2011 4:22 PM GMT+0700

Crude oil retreated from its highest price in almost two weeks amid speculation that supply disruptions from political unrest in North African and the Middle East may be confined to Libya.
Futures slipped after climbing as much as 0.3 percent as demonstrators in Yemen spent the night on streets to maintain pressure on President Ali Abdullah Saleh, who is facing a growing internal revolt. Tension in the region is adding a risk premium of $15 to $20 a barrel to Brent oil prices, according to Societe Generale SA.

“The unrest in Libya seems to be priced in almost completely by now,” Eugen Weinberg, head of commodities research at Commerzbank AG in Frankfurt, said in an interview with Bloomberg television. “The price will stay at elevated levels of around $110 to $120 for several months and will drop back to $90 by the year-end.”

Crude for April delivery on the New York Mercantile Exchange was at $102.05 a barrel, down 28 cents, at 9:15 a.m. London time, after rising as high as $102.67. Yesterday, it gained $1.26 to $102.33, the highest settlement since March 10. The April contract expires today. The more-actively traded May futures were down 22 cents at $102.87 a barrel. Brent oil for May settlement was at $114.65, down 31 cents, on the ICE Futures Europe exchange in London after rising as much as 0.5 percent. The spread between the two May contracts narrowed to $11.80 a barrel from $11.87 yesterday.

Regional Unrest

Regional turmoil has toppled the leaders of Tunisia and Egypt and reached Yemen, Bahrain and Syria. Societe Generale raised its forecast for Brent by $11 to average $109 a barrel this year as political risks increased, analysts led by Michael Wittner said in a report dated yesterday.

Allied forces are expanding their air campaign over Libya in an effort to thwart Muammar Qaddafi’s fighters and enable rebels to control cities, such as the opposition capital of Benghazi, which had been under attack by troops loyal to the regime. The Libyan leader denounced the coalition allied against him, which includes the U.S., the U.K. and France, as “the party of Satan.”

Libyan output has fallen to fewer than 400,000 barrels a day, Shokri Ghanem, chairman of Libya’s National Oil Co., said on March 19. The country produced 1.59 million barrels a day in January, according to estimates compiled by Bloomberg. Exports may be halted for “many months” because of sanctions and damage to facilities, the International Energy Agency said.

Libyan oil production is likely to remain disrupted for the rest of this year, said Lawrence Eagles, head of commodities research at JPMorgan Chase & Co. in New York.

Protest in Yemen

Thousands of Yemenis spent the night on streets across the country to maintain pressure on President Ali Abdullah Saleh, who is facing a growing internal revolt by army leaders, ministers and diplomats. Yemen produced about 298,000 barrels of oil daily in 2009, according to BP Plc data.

Military officers including Ali Muhsin al-Ahmar, commander of the first armored division, and Mohammed Ali Muhssein, commander of the eastern region, abandoned the regime yesterday. Their move was a result of the crackdown three days ago that left dozens dead, said Mohammed al-Sabri, an opposition leader.

Bahrain’s government declared a three-month state of emergency on March 15 after troops from Saudi Arabia and other Arab Gulf states arrived to help in quelling more than a month of protests.

Japan is delivering more relief supplies in areas hardest hit by the March 11 earthquake as workers restored power to two reactors at a crippled Fukushima Dai-Ichi nuclear power plant yesterday, prompting Prime Minister Naoto Kan to say there was “light at the end of the tunnel.”

Short-Term Drop

“The recent tragic events in Japan will result in a sharp short-term drop in economic activity but is likely to be followed by a strong recovery driven by reconstruction and replacement of durables which would boost the demand for many commodities,” Societe Generale’s analysts said.

Japan was responsible for 5.2 percent of global oil demand in 2009, according to BP, which publishes its Statistical Review of World Energy each June. Japan is the third-biggest crude- consuming country, after the U.S. and China.

To contact the reporters on this story: Ann Koh in Singapore at akoh15@bloomberg.net; Grant Smith in London at gsmith52@bloomberg.net

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