US Crude Oil Futures Settle Down; Products Hit One-Month High

U.S. crude oil futures ended weaker but above the day's lows, while refined products futures hit one-month highs on hopes of a coming improvement in the economy of the world's biggest oil consumer.

Oil traders looked beyond the highest stocks of U.S. crude oil in 32 years, and the current sluggish growth in fuel consumption, to bid up prices late in the session. Analysts said the rally was spurred by the hope that strong indicators from the U.S. market would jump-start sputtering oil demand.

The Labor Department's count of new weekly claims for unemployment benefits came in lower than economists had forecast, while a widely watched indicator of layoffs fell to prerecession levels for the first time. The four-week average of benefits claims dropped to the lowest level since November 2007.

"There's a little bit more optimism there, but I think we have to see it play out a little longer," said Gene McGillian, broker and analyst at Tradition Energy.

Light, sweet crude oil for June delivery on the New York Mercantile Exchange settled down 23 cents, at $96.39 a barrel, but up more than $1 from the session low of $95.35.

June Brent crude oil on the InterContinental Exchange shed earlier losses to settle 13 cents higher, at $104.47 a barrel.

Brent's premium to the U.S. benchmark was $8.08 a barrel at the settlement, up from $7.72 a day earlier, which was the lowest level since Jan. 20, 2011.

Brent's premium to the U.S. benchmark has narrowed considerably as rapidly rising domestic crude oil output makes its way to the key Gulf Coast refining region, displacing imports of Brent and similar crudes.

Refiners are shipping oil from the midcontinent to the Gulf by truck and rail, as well as pipelines, chipping away at the supply surplus in landlocked Cushing, Okla. Oil inventories at the hub, which is the delivery point for the Nymex futures contract, have fallen by 2 million barrels in the past two weeks. The year-on-year surplus has dropped to 5 million barrels from nearly 24 million barrels in January.

As the regional bottleneck eases, the Brent premium has narrowed to near $8 a barrel, from $17 a barrel early this year.

Crude prices had been under pressure from government data showing stocks rose modestly last week to the highest level since April 1981. The Energy Information Administration also said in its weekly oil supply/demand report Thursday that demand for gasoline, the most widely used petroleum product in the nation, dropped by 400,000 barrels a day last week from the year-earlier level. The 4.7% drop was the biggest at the early May start of the driving season since 1994.

But traders said there is widespread hope that increasing refinining activity will reduce the deep inventories and that a pickup in the economy will boost demand for refined products, even as the EIA sees summer gasoline use slipping to a 12-year low in the peak spring-summer driving season.

In June, the EIA projects crude oil processing at refineries will average 15.6 million barrels, up about 440,000 barrels a day above current levels, and crude stocks will fall by about 12 million barrels by the end of June, to just below year-earlier levels. Stocks are now above the year-earlier level by 16 million barrels, or 4.2%.

Tim Evans, analyst at Citi Futures, warned that these expectations make for "a weak bullish arguement" because if fuel demand doesn't improve, the problem of high crude oil stocks is simply shifted in the refined products market.

June heating oil futures settled 2.19 cents higher, at $2.9366 a gallon, the highest level since April 10.

Reformulated gasoline blendstock futures for June delivery settled at the highest level since April 9, gaining 3.13 cents, to $2.8851 a gallon.

Copyright (c) 2013 Dow Jones & Company, Inc.

Generated by readers, the comments included herein do not reflect the views and opinions of Rigzone. All comments are subject to editorial review. Off-topic, inappropriate or insulting comments will be removed.

View the original article here

Crude Oil Futures Settle at Two-Week Highs on Supply Concerns

Crude-oil futures prices settled at two-week highs Thursday on concerns over tightening supplies, while U.S. gasoline demand heats up ahead of the peak spring-summer driving season.

Traders said weakness in the dollar, rising equities prices and news that U.S. weekly claims for jobless benefits fell to the lowest level in nearly five years added to buying interest.

"There are a bunch of things going on. There does seem to be some risk-on buying in the last couple of days," said Andy Lebow, senior vice president for energy futures at Jefferies Bache. Mr. Lebow and others said oil-market investors are sensing that oil demand in the U.S. will be stronger in the near term than elsewhere and are favoring the U.S. benchmark futures contract over internationally traded North Sea Brent crude.

Implied demand for gasoline--the most widely used petroleum product in the world's biggest oil consumer--climbed to its highest level since November last week, U.S. government data showed. Gasoline stockpiles logged their biggest drop in a year, breathing new life into futures contracts that fell to a four-month low in recent days.

"People have been so down on demand. Whether it's a fluke, or seasonal, it doesn't really matter. There is a perception that demand is getting better," said Phil Flynn, analyst at Price Futures.

The EIA has forecast that gasoline demand will be slightly down this spring-summer from a year-earlier and drop to a 12-year low. But the near-term strength is spilling over into crude oil prices, on expectations that refiners will use more to turn out more refined products.

Light, sweet crude oil for June delivery on the New York Mercantile Exchange climbed 2.4%, or $2.21 a barrel, to $93.64 a barrel, the highest price since April 10. The rise followed a 2.5% gain on Wednesday that was the biggest rise for the year.

June Brent crude oil on the InterContinental Exchange rose 1.68 a barrel, or 1.7%, to $103.41 a barrel, a two-week high. The gain was the biggest since Dec. 26.

Brent's premium to the U.S. benchmark was $9.77 a barrel at the settlement, the smallest since Jan. 3, 2012. The spread topped $23 a barrel as recently as early February, but surging U.S. oil output, now at a 21-year high above 7.3 million barrels a day has cut deeply into U.S. crude imports, shrinking Brent's value to the U.S. benchmark.

New technologies such as hydraulic fracturing and horizontal drilling have unlocked vast oil reserve trapped in shale, pushing U.S. output higher by 20% this year and by 1.2 million barrels a day from a year ago. Imports have dropped by as much as domestic output has risen, as crude supplies make their way to the Gulf Coast refining hub, eliminating the need for foreign barrels which compete with Brent.

Brent found support Thursday from a Reuters report quoting industry sources saying that work on a gas pipeline will cut crude oil output from the seven-field Norwegian Ekofisk complex for three weeks this June. Ekofisk produces around 170,000 barrels a day of crude.

Buoyant gasoline future found further strength from a fire at a unit of a Louisiana refinery that makes octane enhancers for gasoline.

The fire, at a reformer unit at Alon USA Energy Inc.'s 83,000-barrels-a-day Krotz Springs, La., was quickly extinguished, the company said. But the impact on operations at the plant isn't yet clear.

Nymex May reformulated gasoline futures posted their biggest gain since March, rising 6.44 cents, or 2.3%, to settle at $2.8118 a gallon, a two-week high.

Heating oil for May delivery rose for a sixth straight session, settling 6.04 cents, or 2.1% higher, at $2.9017 a gallon. The rise was the biggest since Nov. 19, 2012, and put prices at a two-week high. The heating oil contract trades as a proxy for ultra-low sulfur diesel fuel, which fuels trucks and trains.

Copyright (c) 2013 Dow Jones & Company, Inc.

Generated by readers, the comments included herein do not reflect the views and opinions of Rigzone. All comments are subject to editorial review. Off-topic, inappropriate or insulting comments will be removed.

View the original article here

Crude Oil Futures Settle at Two-Week Highs on Supply Concerns

Crude-oil futures prices settled at two-week highs Thursday on concerns over tightening supplies, while U.S. gasoline demand heats up ahead of the peak spring-summer driving season.

Traders said weakness in the dollar, rising equities prices and news that U.S. weekly claims for jobless benefits fell to the lowest level in nearly five years added to buying interest.

"There are a bunch of things going on. There does seem to be some risk-on buying in the last couple of days," said Andy Lebow, senior vice president for energy futures at Jefferies Bache. Mr. Lebow and others said oil-market investors are sensing that oil demand in the U.S. will be stronger in the near term than elsewhere and are favoring the U.S. benchmark futures contract over internationally traded North Sea Brent crude.

Implied demand for gasoline--the most widely used petroleum product in the world's biggest oil consumer--climbed to its highest level since November last week, U.S. government data showed. Gasoline stockpiles logged their biggest drop in a year, breathing new life into futures contracts that fell to a four-month low in recent days.

"People have been so down on demand. Whether it's a fluke, or seasonal, it doesn't really matter. There is a perception that demand is getting better," said Phil Flynn, analyst at Price Futures.

The EIA has forecast that gasoline demand will be slightly down this spring-summer from a year-earlier and drop to a 12-year low. But the near-term strength is spilling over into crude oil prices, on expectations that refiners will use more to turn out more refined products.

Light, sweet crude oil for June delivery on the New York Mercantile Exchange climbed 2.4%, or $2.21 a barrel, to $93.64 a barrel, the highest price since April 10. The rise followed a 2.5% gain on Wednesday that was the biggest rise for the year.

June Brent crude oil on the InterContinental Exchange rose 1.68 a barrel, or 1.7%, to $103.41 a barrel, a two-week high. The gain was the biggest since Dec. 26.

Brent's premium to the U.S. benchmark was $9.77 a barrel at the settlement, the smallest since Jan. 3, 2012. The spread topped $23 a barrel as recently as early February, but surging U.S. oil output, now at a 21-year high above 7.3 million barrels a day has cut deeply into U.S. crude imports, shrinking Brent's value to the U.S. benchmark.

New technologies such as hydraulic fracturing and horizontal drilling have unlocked vast oil reserve trapped in shale, pushing U.S. output higher by 20% this year and by 1.2 million barrels a day from a year ago. Imports have dropped by as much as domestic output has risen, as crude supplies make their way to the Gulf Coast refining hub, eliminating the need for foreign barrels which compete with Brent.

Brent found support Thursday from a Reuters report quoting industry sources saying that work on a gas pipeline will cut crude oil output from the seven-field Norwegian Ekofisk complex for three weeks this June. Ekofisk produces around 170,000 barrels a day of crude.

Buoyant gasoline future found further strength from a fire at a unit of a Louisiana refinery that makes octane enhancers for gasoline.

The fire, at a reformer unit at Alon USA Energy Inc.'s 83,000-barrels-a-day Krotz Springs, La., was quickly extinguished, the company said. But the impact on operations at the plant isn't yet clear.

Nymex May reformulated gasoline futures posted their biggest gain since March, rising 6.44 cents, or 2.3%, to settle at $2.8118 a gallon, a two-week high.

Heating oil for May delivery rose for a sixth straight session, settling 6.04 cents, or 2.1% higher, at $2.9017 a gallon. The rise was the biggest since Nov. 19, 2012, and put prices at a two-week high. The heating oil contract trades as a proxy for ultra-low sulfur diesel fuel, which fuels trucks and trains.

Copyright (c) 2013 Dow Jones & Company, Inc.

Generated by readers, the comments included herein do not reflect the views and opinions of Rigzone. All comments are subject to editorial review. Off-topic, inappropriate or insulting comments will be removed.

View the original article here

Nymex Crude Futures Settle at Fresh 2013 Low on Demand Woes

Oil futures extended their recent losses Wednesday, hitting their lowest level all year in the U.S., as investors focused on falling gasoline demand in a weekly report on domestic crude stockpiles.

The Energy Information Administration said its measure of demand for the motor fuel fell 1.1% to 8.3 million barrels a day during the week ended April 12, the lowest level for that week in 16 years.

The decline in demand follows weeks of disappointing economic headlines, which have damped sentiment about oil demand.

"Demand is weakening and looking at the economic numbers of the last few weeks we knew that was going to happen," said Carl Larry, president of Oil Outlooks and Opinions, an energy newsletter.

Light, sweet crude for May delivery settled $2.04, or 2.3%, lower at $86.68 a barrel on the New York Mercantile Exchange, the lowest finish yet this year. Brent crude on the ICE futures exchange recently declined $2.11, or 2.1%, to $97.80 a barrel.

The disappointing gasoline demand figure is the latest sign that demand concerns have captured the focus in the oil market, particularly in the wake of disappointing economic data out of the U.S. and elsewhere.

In recent weeks, the International Energy Agency, the Organization of the Petroleum Exporting Countries and the Energy Information Administration all cut their outlook for 2013 oil demand growth. Nymex crude has fallen more than 10% since a recent high in February, while Brent has shed more than 15% since February.

"Demand, especially in Europe, is going to continue to be poor," said Andy Lipow, president of Lipow Oil Associates, a Houston consultancy. "That and stagnant growth in the U.S. Those are weighing on the market."

Analysts at BNP Paribas were the latest market observers to cut their oil-price forecast, citing the recent market downturn. The analysts cut their 2013 average forecast for Nymex crude to $95 a barrel from $100 and cut their Brent outlook to $108 from $115, though they said prices could recover later in the year.

The EIA said oil stockpiles last week dropped 1.2 million barrels last week, marking a retreat from a 23-year high. Analysts surveyed by Dow Jones Newswires were calling for an increase of 900,000 barrels. Gasoline stocks fell 600,000 barrels, while stocks of distillates--including heating oil and diesel--jumped 2.4 million barrels.

Refinery utilization fell 0.5 percentage point to 86.3% of capacity.

Analysts expected U.S. gasoline stockpiles to fall by 500,000 barrels, while stocks of distillates were forecast to fall by 500,000 barrels. Refiners are expected to keep operations unchanged.

Front-month May reformulated gasoline blendstock, or RBOB, settled 5.28 cents, or 1.9%, lower at $2.7290 a gallon. May heating oil settled 7.19 cents, or 2.6%, lower at $2.7346 a gallon.

Copyright (c) 2013 Dow Jones & Company, Inc.

Generated by readers, the comments included herein do not reflect the views and opinions of Rigzone. All comments are subject to editorial review. Off-topic, inappropriate or insulting comments will be removed.

View the original article here

Crude-Oil Futures Settle up 1.6% at 5-Week High of $96.34/Barrel

U.S. crude-oil futures jumped 1.6% Tuesday to a five-week high spurred by signs of economic improvement in the world's biggest oil-consumer.

"The market is embracing the fact that the U.S. economy is doing better," said Phil Flynn, broker and analyst at Price Futures.

Benchmark oil futures also were aided in their push to the biggest single-day rise this year by continuing signs that a glut of oil in the Midwest--that weighed on prices--is being drained off.

The Commerce Department said U.S. spending on durable goods rose 5.7%, topping the 4% increase forecast by economists in a Dow Jones Newswires poll. Traders looked favorably on the data, even as a jump in civilian aircraft orders helped mask a decline in business investment in big-ticket items.

The strong durable goods showing was joined by indications of recovery in the housing market. U.S. home prices rose more than expected during January from a year earlier, the biggest increase since the summer of 2006, according to Standard & Poor's Case-Shiller home-price indexes.

But the Conference Board said U.S. consumer confidence fell more than eight points to 59.7 in March, amid economic uncertainty created by mandated federal budget cuts.

Andy Lebow, senior vice president for energy futures at Jefferies Bache LLC, said "traders live in great hope that the economic data translates into higher oil demand."

Light, sweet crude oil for May delivery on the New York Mercantile Exchange settled 1.6% higher at $96.34 a barrel, the highest price since Feb. 19. Front-month crude oil has gained 4.2%, or $3.89 a barrel in the past three sessions, vaulting higher after breaking through the top of a $91-$94 trading range that framed prices for the past month.

May ICE North Sea Brent crude oil settled $1.19 a barrel higher, $109.36 a barrel.

Brent's premium to the U.S. benchmark, which stood at $20 a month ago, dropped back to $13.02 a barrel, the lowest level since July 3, after falling below $12 a barrel in intraday trading.

Rising flows of North Sea oil after production snags were resolved in recent weeks is keeping pressure on Brent, as is weaker demand in Europe caused by refinery maintenance and the economic slowdown.

Gene McGillian, broker and analyst at Tradition Energy, said new investors continue to emerge in the market buying the Nymex contract and selling the Brent contract.

The U.S. benchmark has been gaining at the expense of Brent as increased volumes of domestic oil are moving out of the chokepoint at Cushing, Okla. down to Gulf Coast refineries, where they are grabbing market share from imported crudes and depressing Brent prices.

"We've seen Cushing levels drop below 50 million barrels as the bottleneck is easing," he said. "We've seen draws for the past two weeks and people are expecting more as folks are moving barrels by trains and trucks as well as the pipeline. That's really added more fuel to the bulls' fire."

Upcoming U.S. oil inventory data is expected to show crude oil stocks rose, despite a modest gain in refinery operations last week.

According to early estimates from five analysts surveyed by Dow Jones Newswires, U.S. crude oil inventories rose by 700,000 barrels in the week ended March 22.

The closely watched government survey from the Energy Information Administration is due to be released at 10:30 a.m. EDT Wednesday. The American Petroleum Institute, an industry group, is due to report its own data at 4:30 p.m. EDT Tuesday.

Forecasters expect the data to show gasoline stocks dropped by 900,000 barrels, while distillate stocks (heating oil and diesel fuel) fell by 600,000 barrels. Refiners are expected to boost operations by 0.3 percentage point to 83.8% of capacity, based on EIA's data.

Mark Waggoner, president of Excel Futures, said he expects declines in inventories of refined products, especially gasoline, will keep prices support as the spring-summer driving season approaches, boosting fuel demand.

April-delivery reformulated blendstock gasoline futures settled 4.8 cents higher, at $3.1106 a gallon. April heating oil settled 0.41 cent higher, at $2.8813 a gallon.

Copyright (c) 2012 Dow Jones & Company, Inc.

Generated by readers, the comments included herein do not reflect the views and opinions of Rigzone. All comments are subject to editorial review. Off-topic, inappropriate or insulting comments will be removed.

View the original article here

Crude-Oil Futures Settle up 1.6% at 5-Week High of $96.34/Barrel

U.S. crude-oil futures jumped 1.6% Tuesday to a five-week high spurred by signs of economic improvement in the world's biggest oil-consumer.

"The market is embracing the fact that the U.S. economy is doing better," said Phil Flynn, broker and analyst at Price Futures.

Benchmark oil futures also were aided in their push to the biggest single-day rise this year by continuing signs that a glut of oil in the Midwest--that weighed on prices--is being drained off.

The Commerce Department said U.S. spending on durable goods rose 5.7%, topping the 4% increase forecast by economists in a Dow Jones Newswires poll. Traders looked favorably on the data, even as a jump in civilian aircraft orders helped mask a decline in business investment in big-ticket items.

The strong durable goods showing was joined by indications of recovery in the housing market. U.S. home prices rose more than expected during January from a year earlier, the biggest increase since the summer of 2006, according to Standard & Poor's Case-Shiller home-price indexes.

But the Conference Board said U.S. consumer confidence fell more than eight points to 59.7 in March, amid economic uncertainty created by mandated federal budget cuts.

Andy Lebow, senior vice president for energy futures at Jefferies Bache LLC, said "traders live in great hope that the economic data translates into higher oil demand."

Light, sweet crude oil for May delivery on the New York Mercantile Exchange settled 1.6% higher at $96.34 a barrel, the highest price since Feb. 19. Front-month crude oil has gained 4.2%, or $3.89 a barrel in the past three sessions, vaulting higher after breaking through the top of a $91-$94 trading range that framed prices for the past month.

May ICE North Sea Brent crude oil settled $1.19 a barrel higher, $109.36 a barrel.

Brent's premium to the U.S. benchmark, which stood at $20 a month ago, dropped back to $13.02 a barrel, the lowest level since July 3, after falling below $12 a barrel in intraday trading.

Rising flows of North Sea oil after production snags were resolved in recent weeks is keeping pressure on Brent, as is weaker demand in Europe caused by refinery maintenance and the economic slowdown.

Gene McGillian, broker and analyst at Tradition Energy, said new investors continue to emerge in the market buying the Nymex contract and selling the Brent contract.

The U.S. benchmark has been gaining at the expense of Brent as increased volumes of domestic oil are moving out of the chokepoint at Cushing, Okla. down to Gulf Coast refineries, where they are grabbing market share from imported crudes and depressing Brent prices.

"We've seen Cushing levels drop below 50 million barrels as the bottleneck is easing," he said. "We've seen draws for the past two weeks and people are expecting more as folks are moving barrels by trains and trucks as well as the pipeline. That's really added more fuel to the bulls' fire."

Upcoming U.S. oil inventory data is expected to show crude oil stocks rose, despite a modest gain in refinery operations last week.

According to early estimates from five analysts surveyed by Dow Jones Newswires, U.S. crude oil inventories rose by 700,000 barrels in the week ended March 22.

The closely watched government survey from the Energy Information Administration is due to be released at 10:30 a.m. EDT Wednesday. The American Petroleum Institute, an industry group, is due to report its own data at 4:30 p.m. EDT Tuesday.

Forecasters expect the data to show gasoline stocks dropped by 900,000 barrels, while distillate stocks (heating oil and diesel fuel) fell by 600,000 barrels. Refiners are expected to boost operations by 0.3 percentage point to 83.8% of capacity, based on EIA's data.

Mark Waggoner, president of Excel Futures, said he expects declines in inventories of refined products, especially gasoline, will keep prices support as the spring-summer driving season approaches, boosting fuel demand.

April-delivery reformulated blendstock gasoline futures settled 4.8 cents higher, at $3.1106 a gallon. April heating oil settled 0.41 cent higher, at $2.8813 a gallon.

Copyright (c) 2012 Dow Jones & Company, Inc.

Generated by readers, the comments included herein do not reflect the views and opinions of Rigzone. All comments are subject to editorial review. Off-topic, inappropriate or insulting comments will be removed.

View the original article here

Crude-Oil Futures Settle Up 29 Cents at $93.74/Barrel

Crude-oil futures prices recovered Monday from early concerns over Europe's economic outlook, with the U.S. benchmark inching up to a fresh four-week high.

Oil pries had joined in an early, broad selloff sparked by worries over the potential for new fiscal woes in Europe as Cyprus weighed a controversial bailout plan. As part of a European Union and International Monetary Fund rescue package for its banks, Cyprus is considering a one-time tax levy on accounts held in its banks. Traders said that if such a tax becomes standard in other rescue packages, investors will flee, churning up concerns of a contagion effect in European economics battling sovereign debt crises.

The knock-on fears sent the euro to its lowest level of the year against the dollar, giving investors two strong reasons to flee oil futures. Analysts said fresh trouble in European economies would further cut weak oil demand, while a stronger dollar means crude-oil futures become pricier for investors using some foreign currencies.

An early drop to $91.76 a barrel in U.S. prices appeared to signal that market bulls were losing the clout that pushed prices up near $94 last week, despite rising crude-oil stockpiles and weak refiner demand during seasonal maintenance.

But as the euro steadied, "the fears evaporated and we started to stabilize. All the worries were a little overdone," said Gene McGillian, broker and analyst at Tradition Energy.

Light, sweet crude oil for April delivery on the New York Mercantile Exchange settled 29 cents higher, at $93.74 a barrel, the highest level since Feb. 20.

ICE North Sea crude oil for May ended modestly lower, at $109.51 a barrel, down 31 cents. It traded to an early low of $107.78 a barrel.

Brent has lost ground against the U.S. benchmark in recent days as North Sea crude oil supplies are returning to normal levels.

Michael Wittner, analyst at Societe Generale, said North Sea oil flows in April are expected to rise by 265,000 barrels a day from March, as pipeline and production snags have been resolved. Separately, Statoil ASA said output from the Oseberg field in the Norwegian North Sea was returning to normal after a gas leak and power cut last week. Oseberg is expected to supply 3.6 million barrels of crude in April.

Analysts also noted that crude-oil inventories at Cushing, Okla., declined in the week ended March 8, suggesting that the oil was finding its way down to the key U.S. refinery hub, most likely by increased rail shipments. Greater flows from the midcontinent to the Gulf means U.S. refiners need less imported crude, putting pressure on Brent, the global benchmark.

Early indications from four analysts show U.S. weekly oil data are expected to show crude-oil stockpiles rose last week while refiners kept operations little changed at low levels. According to the survey by Dow Jones Newswires, U.S. crude-oil inventories rose by 1.1 million barrels in the week ended Friday, adding to already high stocks.

In the week ended March 8, the combination of refiner demand and higher supply left inventories at a level sufficient to cover 27.4 days of refiner needs, the highest level since 1992, and compared with the five-year average of less than 24 days of cover.

The closely watched government survey from the Energy Information Administration is due to be released at 10:30 a.m. EDT Wednesday, while the American Petroleum Institute, an industry group, releases its inventory report at 4:30 p.m. EST Tuesday.

Analysts also expect the data to show gasoline stocks dropped by 2.1 million barrels and distillate stocks (heating oil and diesel fuel) fell by 1.3 million barrels.

Refiners are expected to inch operations higher by 0.1 percentage point from the EIA's level of 81% of capacity last week, which was the lowest since Feb. 25, 2011, amid seasonal maintenance work at plants.

April-delivery reformulated gasoline futures settled 3.49 cents, or 1.1%, lower at $3.1289 a gallon, the lowest level since March 7. April heating oil settled 1.23 cents lower at $2.9267 a gallon.

Copyright (c) 2012 Dow Jones & Company, Inc.

Generated by readers, the comments included herein do not reflect the views and opinions of Rigzone. All comments are subject to editorial review. Off-topic, inappropriate or insulting comments will be removed.

View the original article here

Crude-Oil Futures Settle Up 29 Cents at $93.74/Barrel

Crude-oil futures prices recovered Monday from early concerns over Europe's economic outlook, with the U.S. benchmark inching up to a fresh four-week high.

Oil pries had joined in an early, broad selloff sparked by worries over the potential for new fiscal woes in Europe as Cyprus weighed a controversial bailout plan. As part of a European Union and International Monetary Fund rescue package for its banks, Cyprus is considering a one-time tax levy on accounts held in its banks. Traders said that if such a tax becomes standard in other rescue packages, investors will flee, churning up concerns of a contagion effect in European economics battling sovereign debt crises.

The knock-on fears sent the euro to its lowest level of the year against the dollar, giving investors two strong reasons to flee oil futures. Analysts said fresh trouble in European economies would further cut weak oil demand, while a stronger dollar means crude-oil futures become pricier for investors using some foreign currencies.

An early drop to $91.76 a barrel in U.S. prices appeared to signal that market bulls were losing the clout that pushed prices up near $94 last week, despite rising crude-oil stockpiles and weak refiner demand during seasonal maintenance.

But as the euro steadied, "the fears evaporated and we started to stabilize. All the worries were a little overdone," said Gene McGillian, broker and analyst at Tradition Energy.

Light, sweet crude oil for April delivery on the New York Mercantile Exchange settled 29 cents higher, at $93.74 a barrel, the highest level since Feb. 20.

ICE North Sea crude oil for May ended modestly lower, at $109.51 a barrel, down 31 cents. It traded to an early low of $107.78 a barrel.

Brent has lost ground against the U.S. benchmark in recent days as North Sea crude oil supplies are returning to normal levels.

Michael Wittner, analyst at Societe Generale, said North Sea oil flows in April are expected to rise by 265,000 barrels a day from March, as pipeline and production snags have been resolved. Separately, Statoil ASA said output from the Oseberg field in the Norwegian North Sea was returning to normal after a gas leak and power cut last week. Oseberg is expected to supply 3.6 million barrels of crude in April.

Analysts also noted that crude-oil inventories at Cushing, Okla., declined in the week ended March 8, suggesting that the oil was finding its way down to the key U.S. refinery hub, most likely by increased rail shipments. Greater flows from the midcontinent to the Gulf means U.S. refiners need less imported crude, putting pressure on Brent, the global benchmark.

Early indications from four analysts show U.S. weekly oil data are expected to show crude-oil stockpiles rose last week while refiners kept operations little changed at low levels. According to the survey by Dow Jones Newswires, U.S. crude-oil inventories rose by 1.1 million barrels in the week ended Friday, adding to already high stocks.

In the week ended March 8, the combination of refiner demand and higher supply left inventories at a level sufficient to cover 27.4 days of refiner needs, the highest level since 1992, and compared with the five-year average of less than 24 days of cover.

The closely watched government survey from the Energy Information Administration is due to be released at 10:30 a.m. EDT Wednesday, while the American Petroleum Institute, an industry group, releases its inventory report at 4:30 p.m. EST Tuesday.

Analysts also expect the data to show gasoline stocks dropped by 2.1 million barrels and distillate stocks (heating oil and diesel fuel) fell by 1.3 million barrels.

Refiners are expected to inch operations higher by 0.1 percentage point from the EIA's level of 81% of capacity last week, which was the lowest since Feb. 25, 2011, amid seasonal maintenance work at plants.

April-delivery reformulated gasoline futures settled 3.49 cents, or 1.1%, lower at $3.1289 a gallon, the lowest level since March 7. April heating oil settled 1.23 cents lower at $2.9267 a gallon.

Copyright (c) 2012 Dow Jones & Company, Inc.

Generated by readers, the comments included herein do not reflect the views and opinions of Rigzone. All comments are subject to editorial review. Off-topic, inappropriate or insulting comments will be removed.

View the original article here

Crude-Oil Futures Settle 42 Cents Higher

Crude-oil futures prices settled at a three-week high Friday amid mixed signals on a sustained economic recovery in the world's biggest oil consumer.

U.S. benchmark crude mustered a modest gain, but ended well below the high of the trading session as market participants weighed fresh data. The Federal Reserve said U.S. industrial production rose 0.7% in February, exceeding economists' forecasts and eclipsing concerns over a sharp drop in consumer confidence and a rise in consumer prices.

The Thomson-Reuters/University of Michigan consumer sentiment index fell to 71.8 in mid-March, its lowest level since December 2011 and down from 77.6 in February. Economists have expected the reading to move up to 78. Also Friday, the Labor Department said the consumer price index in February rose 0.7%, the biggest gain since June 2009, led by higher gasoline prices.

"We are seeing some strong signs, but whether they are strong enough is still up in the air," said Gene McGillian, analyst and broker at Tradition Energy. He noted that oil prices have recovered from two-month lows below $90 a barrel hit early this month, but said it's unclear whether economic and oil-market fundamentals can sustain a further rally.

Light, sweet crude oil for April delivery on the New York Mercantile Exchange settled 42 cents higher, at $93.45 a barrel. That's the highest price since Feb. 20, but well below the session high of $93.84 a barrel.

ICE North Sea Brent for May delivery, in its first day as the front-month contract, settled 86 cents higher, at $109.82 a barrel. Traders said the contract found buyers after front-month prices hovered near the 200-day moving average price, a key indicator for chart-based trading, near $109.40 a barrel in recent days.

News that Norwegian oil producer Statoil shut its North Sea Oseberg oil field on Thursday after a power outage and gas leak also kept Brent supported. Oseberg is expected to supply 3.6 million barrels of crude during April, and analysts said they will be watching developments for signs of any shortfall. The output snag comes as North Sea flows have recovered from earlier operating problems.

U.S. crude oil gained as market participants ignored lofty crude oil stocks and sluggish oil-demand growth. The latest data from the Energy Information Administration show refinery maintenance has slowed crude oil processing to a two-year low and pushed crude oil inventories to more than 40 million barrels above the five-year average. Inventories of 384 million barrels are sufficient to cover more than 27 days of refiner needs, the highest level in 21 years.

Analysts said investors appear to be taking the view that crude inventories will decline when maintenance ends and refineries ramp up output of gasoline and diesel fuel.

Days before a trip to the Middle East, President Barack Obama said it would take Iran a year or more to build a nuclear weapon, an assessment that sets up a potential area of discord with Israel's leader. The president's timelime is longer than the more urgent one usually cited by Israeli Prime Minister Benjamin Netanyahu. The timeline, the first publicly given by Mr. Obama, appeared to be tamping down any expectations for pre-emptive action against Iran while aiming to assure its closest Mideast ally of U.S. support.

Iran had been the second-biggest oil producer in the Organization of the Petroleum Exporting Countries, but international sanctions over its nuclear program have cut flows to their lowest level in 30 years.

April-delivery reformulated gasoline futures settled up 2.25 cents at $3.1638 a gallon after falling 1.9% in the prior four days. April heating oil settled up 0.95 cent at $2.939 a gallon.

Copyright (c) 2012 Dow Jones & Company, Inc.

Generated by readers, the comments included herein do not reflect the views and opinions of Rigzone. All comments are subject to editorial review. Off-topic, inappropriate or insulting comments will be removed.

View the original article here

Crude-Oil Futures Settle 42 Cents Higher

Crude-oil futures prices settled at a three-week high Friday amid mixed signals on a sustained economic recovery in the world's biggest oil consumer.

U.S. benchmark crude mustered a modest gain, but ended well below the high of the trading session as market participants weighed fresh data. The Federal Reserve said U.S. industrial production rose 0.7% in February, exceeding economists' forecasts and eclipsing concerns over a sharp drop in consumer confidence and a rise in consumer prices.

The Thomson-Reuters/University of Michigan consumer sentiment index fell to 71.8 in mid-March, its lowest level since December 2011 and down from 77.6 in February. Economists have expected the reading to move up to 78. Also Friday, the Labor Department said the consumer price index in February rose 0.7%, the biggest gain since June 2009, led by higher gasoline prices.

"We are seeing some strong signs, but whether they are strong enough is still up in the air," said Gene McGillian, analyst and broker at Tradition Energy. He noted that oil prices have recovered from two-month lows below $90 a barrel hit early this month, but said it's unclear whether economic and oil-market fundamentals can sustain a further rally.

Light, sweet crude oil for April delivery on the New York Mercantile Exchange settled 42 cents higher, at $93.45 a barrel. That's the highest price since Feb. 20, but well below the session high of $93.84 a barrel.

ICE North Sea Brent for May delivery, in its first day as the front-month contract, settled 86 cents higher, at $109.82 a barrel. Traders said the contract found buyers after front-month prices hovered near the 200-day moving average price, a key indicator for chart-based trading, near $109.40 a barrel in recent days.

News that Norwegian oil producer Statoil shut its North Sea Oseberg oil field on Thursday after a power outage and gas leak also kept Brent supported. Oseberg is expected to supply 3.6 million barrels of crude during April, and analysts said they will be watching developments for signs of any shortfall. The output snag comes as North Sea flows have recovered from earlier operating problems.

U.S. crude oil gained as market participants ignored lofty crude oil stocks and sluggish oil-demand growth. The latest data from the Energy Information Administration show refinery maintenance has slowed crude oil processing to a two-year low and pushed crude oil inventories to more than 40 million barrels above the five-year average. Inventories of 384 million barrels are sufficient to cover more than 27 days of refiner needs, the highest level in 21 years.

Analysts said investors appear to be taking the view that crude inventories will decline when maintenance ends and refineries ramp up output of gasoline and diesel fuel.

Days before a trip to the Middle East, President Barack Obama said it would take Iran a year or more to build a nuclear weapon, an assessment that sets up a potential area of discord with Israel's leader. The president's timelime is longer than the more urgent one usually cited by Israeli Prime Minister Benjamin Netanyahu. The timeline, the first publicly given by Mr. Obama, appeared to be tamping down any expectations for pre-emptive action against Iran while aiming to assure its closest Mideast ally of U.S. support.

Iran had been the second-biggest oil producer in the Organization of the Petroleum Exporting Countries, but international sanctions over its nuclear program have cut flows to their lowest level in 30 years.

April-delivery reformulated gasoline futures settled up 2.25 cents at $3.1638 a gallon after falling 1.9% in the prior four days. April heating oil settled up 0.95 cent at $2.939 a gallon.

Copyright (c) 2012 Dow Jones & Company, Inc.

Generated by readers, the comments included herein do not reflect the views and opinions of Rigzone. All comments are subject to editorial review. Off-topic, inappropriate or insulting comments will be removed.

View the original article here

Crude-Oil Futures Settle Down at $92.52/Barrel

Attempts to push a rally in U.S. crude-oil futures prices into a fifth day faltered Wednesday under the weight of rising inventories and worries over weak demand.

Data that showed U.S. crude oil supply relative to refiner demand climbed to a 21-year high followed a warning by the International Energy Agency, the West's oil-policy watchdog, that the market is facing weaker oil-demand growth and higher supplies.

"The subdued growth rate of oil demand now looks increasingly entrenched in the face of high oil prices and weak economic growth," the IEA said in its monthly global outlook.

That outlook followed a Tuesday report from the U.S. Energy Information Administration which sees only modest growth in oil-demand growth in the world's biggest oil consumer this year after 2012 consumption hit a 16-year low.

EIA's latest weekly oil-inventory data show U.S. refiners trimmed crude-oil processing rates to a two-year low of less than 14 million barrels a day last week, amid maintenance work and operating snags at some facilities. At that same time, rising domestic output and imports lifted stocks by 2.6 million barrels last week, slightly ahead of expectations.

The combination of lower demand and higher supply means current inventories now are sufficient to cover 27.4 days of refiner needs, the highest level since 1992, and compared with the five-year average of less than 24 days of cover.

The data snuffed out an early attempt to push a four-day, 2.3% rally in prices higher for a fifth day.

"The move to push crude up to $93.50 lost momentum," said Gene McGillian, broker and analyst at Tradition Energy. "The fundamentals aren't really particularly strong" enough to justify prices at those levels which were last hit in late February, he said.

Light, sweet crude oil for April delivery on the New York Mercantile Exchange settled 2 cents lower, at $92.52 a barrel, after trading in a range of $93.40 to $91.91 a barrel.

April ICE North Sea Brent crude settled $1.13 lower, at $108.52 a barrel, the lowest price since Dec. 17, 2012.

Traders said Brent came under pressure as the EIA data showed oil inventories at Cushing, Okla. fell by 1.5 million barrels last week, the biggest decline since May 2011. Analysts said the large drop at Cushing suggests that Gulf Coast refiners appear to be moving more crude oil out of the terminal hub that is the delivery point for the Nymex contract, most likely by rail, as pipeline outlets are constrained.

Crude exiting Cushing for the Gulf Coast refinery hub would increase competition with imports priced in relation to Brent, the international benchmark, and would put pressure on Brent prices, traders said. Supplies of North Sea crudes have been rising after operational snags were resolved in recent weeks and the IEA said a pipeline agreement between Sudan and South Sudan means more crude could be flowing from that area, increasing supplies by 200,000 barrels a day by year's end.

Despite a fall of nearly 3.6 million barrels in gasoline stockpiles last week, prices of reformulated gasoline blendstock futures were weaker for a third day. Analysts said the decline in inventories likely reflected movement of fuel during the transition from winter-grade to summer-grade fuel that are typical at this time year, rather than signalling stronger demand. The EIA said in its Short-Term Energy Outlook on Tuesday it sees gasoline stunted at a 2012 level over the next two years, as improvements in fuel-mileage standards cut consumption.

April-delivery reformulated gasoline futures were 0.79 cents lower, at $3.1423 a gallon. The contract fell 1.9% in the past three sessions.

April heating oil was 2.42 cents lower, at $2.9242 a gallon, and lost 1.9% over the past four sessions.

Copyright (c) 2012 Dow Jones & Company, Inc.

Generated by readers, the comments included herein do not reflect the views and opinions of Rigzone. All comments are subject to editorial review. Off-topic, inappropriate or insulting comments will be removed.

View the original article here

Crude-Oil Futures Settle Down at $92.52/Barrel

Attempts to push a rally in U.S. crude-oil futures prices into a fifth day faltered Wednesday under the weight of rising inventories and worries over weak demand.

Data that showed U.S. crude oil supply relative to refiner demand climbed to a 21-year high followed a warning by the International Energy Agency, the West's oil-policy watchdog, that the market is facing weaker oil-demand growth and higher supplies.

"The subdued growth rate of oil demand now looks increasingly entrenched in the face of high oil prices and weak economic growth," the IEA said in its monthly global outlook.

That outlook followed a Tuesday report from the U.S. Energy Information Administration which sees only modest growth in oil-demand growth in the world's biggest oil consumer this year after 2012 consumption hit a 16-year low.

EIA's latest weekly oil-inventory data show U.S. refiners trimmed crude-oil processing rates to a two-year low of less than 14 million barrels a day last week, amid maintenance work and operating snags at some facilities. At that same time, rising domestic output and imports lifted stocks by 2.6 million barrels last week, slightly ahead of expectations.

The combination of lower demand and higher supply means current inventories now are sufficient to cover 27.4 days of refiner needs, the highest level since 1992, and compared with the five-year average of less than 24 days of cover.

The data snuffed out an early attempt to push a four-day, 2.3% rally in prices higher for a fifth day.

"The move to push crude up to $93.50 lost momentum," said Gene McGillian, broker and analyst at Tradition Energy. "The fundamentals aren't really particularly strong" enough to justify prices at those levels which were last hit in late February, he said.

Light, sweet crude oil for April delivery on the New York Mercantile Exchange settled 2 cents lower, at $92.52 a barrel, after trading in a range of $93.40 to $91.91 a barrel.

April ICE North Sea Brent crude settled $1.13 lower, at $108.52 a barrel, the lowest price since Dec. 17, 2012.

Traders said Brent came under pressure as the EIA data showed oil inventories at Cushing, Okla. fell by 1.5 million barrels last week, the biggest decline since May 2011. Analysts said the large drop at Cushing suggests that Gulf Coast refiners appear to be moving more crude oil out of the terminal hub that is the delivery point for the Nymex contract, most likely by rail, as pipeline outlets are constrained.

Crude exiting Cushing for the Gulf Coast refinery hub would increase competition with imports priced in relation to Brent, the international benchmark, and would put pressure on Brent prices, traders said. Supplies of North Sea crudes have been rising after operational snags were resolved in recent weeks and the IEA said a pipeline agreement between Sudan and South Sudan means more crude could be flowing from that area, increasing supplies by 200,000 barrels a day by year's end.

Despite a fall of nearly 3.6 million barrels in gasoline stockpiles last week, prices of reformulated gasoline blendstock futures were weaker for a third day. Analysts said the decline in inventories likely reflected movement of fuel during the transition from winter-grade to summer-grade fuel that are typical at this time year, rather than signalling stronger demand. The EIA said in its Short-Term Energy Outlook on Tuesday it sees gasoline stunted at a 2012 level over the next two years, as improvements in fuel-mileage standards cut consumption.

April-delivery reformulated gasoline futures were 0.79 cents lower, at $3.1423 a gallon. The contract fell 1.9% in the past three sessions.

April heating oil was 2.42 cents lower, at $2.9242 a gallon, and lost 1.9% over the past four sessions.

Copyright (c) 2012 Dow Jones & Company, Inc.

Generated by readers, the comments included herein do not reflect the views and opinions of Rigzone. All comments are subject to editorial review. Off-topic, inappropriate or insulting comments will be removed.

View the original article here

Crude-Oil Futures Settle Lower After Rise in Inventories

Crude-oil futures settled slightly lower Wednesday after a larger-than-expected rise in U.S. inventories stirred concerns about demand.

The federal Energy Information Administration said crude-oil stocks climbed 3.8 million barrels to 381.4 million barrels in the week ended March 1, well above the 500,000-barrel increase analysts expected. The stocks are at the highest level for this time of year in 82 years, as domestic production increased and demand from refiners eased during a period of seasonal maintenance.

"It's the same general theme we've been seeing: crude is plentiful, products are a little tight," said Kyle Cooper, managing partner at IAF Advisors.

The EIA data showed domestic crude production neared 7.1 million barrels a day, or 1.3 million barrels above the same week in 2012.

Refiners cut crude-oil processing by nearly 500,000 barrels a day to the lowest levels in almost two years. At current reduced processing rates of just above 14 million barrels a day, stocks are sufficient to meet nearly four weeks of refiner demand, the highest level in almost 20 years.

Mr. Cooper said seasonal refinery maintenance appears to be running longer than had been expected, and some companies are suffering unplanned outages at units, reducing supply of refined products like gasoline.

Light, sweet crude-oil futures for April delivery on the New York Mercantile Exchange settled 39 cents, or 0.4%, lower at $90.43 a barrel. The contract hit a low of $89.55 a barrel after the EIA data but recovered some losses after failing to break below the 2012 intraday low of $89.33 the front-month contract touched Monday.

Gene McGillian, broker and analyst at Tradition Energy, said he expects prices to consolidate around $90 for the near term, as traders look for clues on the pace of economic recovery and oil demand. U.S. oil use dropped 2.1% to a one-month low last week, EIA data showed.

"We've wiped out $8 from the price and if we continue to see slowing in economies in the U.S. and Europe, prices could go down to the mid-$80s," a level last seen in mid-November, he said.

ICE North Sea Brent for April delivery settled 55 cents, or 0.5%, lower at $111.06 a barrel.

The EIA said U.S. crude-oil imports last week fell by 650,000 barrels a day to 7.3 million barrels a day. Higher domestic flows from shale-oil fields are expected to continue the trend of reducing the need for crude-oil imports.

Gasoline output fell 600,000 barrels a day last week, to a seven-week low, cutting nationwide inventories in the week.

But stocks in Northeast U.S., including the New York Harbor delivery point for the benchmark gasoline futures contract, climbed for an 11th-straight week, as regional supplies continued to recover from effect of Hurricane Sandy. Stocks are 2.6% above year-earlier levels in the region, reversing a mid-December year-on-year fall of 2.5%.

April-delivery reformulated gasoline blendstock futures settled 2.35 cents, or 0.7%, lower at $3.1247 a gallon.

The EIA reported inventories of distillate fuel (diesel/heating oil) fell by a steep 3.83 million barrels, more than five times larger than expectations of a decline of 700,000 barrels. April heating oil gained 0.26 cent, or 0.1%, to settle at a one-week high of $2.9756 a gallon.

Copyright (c) 2012 Dow Jones & Company, Inc.

Generated by readers, the comments included herein do not reflect the views and opinions of Rigzone. All comments are subject to editorial review. Off-topic, inappropriate or insulting comments will be removed.

View the original article here

Crude Oil Futures Settle Higher as U.S. Jobs Market Improves

NEW YORK--Oil futures rose to their highest level all week Friday, as positive U.S. jobs data lifted hopes for higher oil demand.

Light, sweet crude for April delivery settled 39 cents, or 0.4%, higher at $91.95 a barrel on the New York Mercantile Exchange. Brent crude on the ICE futures exchange recently fell 32 cents, or 0.3%, to $110.82 a barrel.

Futures got a boost after the Labor Department said employers added 236,000 jobs in February, far more than the 160,000 forecast by economists. Unemployment fell 0.2 percentage point to 7.7%, the lowest level since the end of 2008.

The data is closely watched in the oil market because the health of the job market in the U.S.--the world's biggest oil consumer--is closely correlated with crude-oil demand.

"This number is a big step," said Carl Larry, head of the oil-trading advisory firm Oil Outlooks and Opinions. "I don't think anybody expected that."

Futures were lower prior to the 8:30 a.m. EST data, then pared their losses throughout the day to end the session in positive territory. Market observers said a late-session rally in the gasoline market also helped pull crude-oil prices higher.

"Crude markets were definitely following the gasoline move today," said Michael Truscelli, broker at oil options brokerage Paramount Options in New York. "There was a lot of interest at the end of the day."

Front-month April reformulated gasoline blendstock, or RBOB, settled 8.02 cents, or 2.6%,, higher at $3.2035 a gallon.

A steadily improving jobs market has buoyed the oil market in recent months, although steadily rising domestic production and uncertain global demand has kept prices in check.

Oil futures failed to keep up with the sharp rally staged by equities, as the payrolls data sent investors snapping up another asset: the U.S. dollar. A stronger dollar typically weighs on oil prices because it makes the dollar-denominated commodity more expensive for holders of other currencies.

The ICE Dollar Index, which tracks the greenback against a basket of currencies, shot to its highest level since early August, recently rising 0.9% to 82.804.

April heating oil settled 0.46 cent, or 0.2%, lower at $2.9749 a gallon.

Copyright (c) 2012 Dow Jones & Company, Inc.

Generated by readers, the comments included herein do not reflect the views and opinions of Rigzone. All comments are subject to editorial review. Off-topic, inappropriate or insulting comments will be removed.

View the original article here

Crude-Oil Futures Settle at 2013 Low of $90.68 a Barrel

Crude-oil futures prices tumbled 1.5% Friday to a low for 2013 as new concerns rose over the global economy.

Prices slumped early on official data from China, the world's second-biggest oil consumer, showing the February purchasing managers' index at 50.1, fractionally above the no-growth mark and down from a reading of 50.4 in January.

Worries over a record-high euro-zone unemployment rate of 11.9% in January kept the market on edge as traders worried about Italy's ability to continue economic reforms after its recent elections.

In the U.S., the Commerce Department said personal income dropped to a 20-year low in January as higher taxes kicked in. Personal incomes fell 3.6%, compared with economists' forecasts for a 2.5% decline. Consumers responded by saving less, rather than spending less, as consumer spending ticked up 0.2%.

Meanwhile, President Barack Obama offered no hint of any deal between the White House and Congress to avoid automatic spending cuts of $85 billion as a deadline loomed.

The president on Friday said the lack of a deal would result in government furloughs and layoffs, but he cautioned that the cuts would not trigger a new financial crisis. "It is absolutely true that this is not going to precipitate the kind of crisis we talked about with America defaulting and some of the problems around the debt ceiling," Mr. Obama said. "I don't anticipate a huge financial crisis, but people are going to be hurt."

Analysts said the pall cast over the U.S. economy in the near term by the cuts doesn't bode well for an already shaky oil-demand outlook for the world's biggest oil consumer.

Light, sweet crude-oil futures for April delivery on the New York Mercantile Exchange dropped $1.37 a barrel to settle at $90.68, the weakest since Dec. 24. In the past month, crude prices have fallen more than $7 a barrel, or 7.3%.

ICE North Sea Brent crude oil for April dropped 98 cents to settle at $110.40 a barrel, also the lowest price since Dec. 24. The price has fallen $4 a barrel since Monday.

Jim Ritterbusch, president of Ritterbusch & Associates, said dollar strength against the euro will be crucial to the near-term oil price. Strength in the dollar discourages some investors with foreign currencies from investing in dollar-based commodities, like oil futures. The euro dropped to the lowest level this year against the dollar on Friday, at $1.30.

"The next $5 price move [is] heavily contingent upon the direction of the U.S. dollar and, more specifically, swings in the euro currency," Mr. Ritterbusch said in a note to clients.

Crude prices also are undermined by the highest levels of U.S. crude oil stocks for this time of year in 30 years.

"We've got really ample supplies, but we're not really seeing any significant pickup or sign that demand is humming along," said Gene McGillian, analyst and broker at Tradition Energy.

April-delivery contracts for reformulated gasoline blendstock futures and heating oil began trading as the front-month on Friday, after March contracts expired Thursday.

The April RBOB contract meets the requirement for summer-grade gasoline, which fetches a higher price than the winter-grade fuel traded in the March contract.

April RBOB settled up 1.69 cents at $3.1286 a gallon, the highest front-month price since Feb. 15.

April heating oil settled down 3.02 cents at $2.9301 a gallon, the lowest price since Dec. 11, as the winter peak demand season essentially ends with the March contract's expiry.

Copyright (c) 2012 Dow Jones & Company, Inc.

Generated by readers, the comments included herein do not reflect the views and opinions of Rigzone. All comments are subject to editorial review. Off-topic, inappropriate or insulting comments will be removed.

View the original article here

Crude-Oil Futures Settle Up After Steep Two-Day Losses

Crude-oil futures prices, battered in a sharp two-day selloff on demand worries, settled modestly higher Friday, while gasoline futures prices rebounded.

"It seems the blood-letting ran its course and the market's trying to catch its breath," said Gene McGillian, broker and analyst at Tradition Energy.

Front-month U.S. benchmark crude-oil futures prices dropped $4.58 a barrel in the previous two days, ending Thursday at a new 2013 low. Prices barely staggered to their feet after the two-day pounding, in which commodity funds shed their expectations of near-term higher prices, helped by a large jump in U.S. crude-oil inventories.

Market anxieties may not let up next week as the March-delivery contracts for reformulated-gasoline and heating-oil futures expire at Thursday's settlement and the March 1 deadline to break a government impasse and reach a deal to avoid $85 billion in automatic spending cuts looms. Failure to reach a deal likely would unnerve markets, traders said.

Light, sweet crude-oil futures for April delivery on the New York Mercantile Exchange settled 29 cents higher, at $93.13 a barrel. The contract fell 3.4%, the worst weekly performance for Nymex crude since Oct. 26, 2012.

April ICE Brent crude oil, which lost $3.99 over the previous two days, settled 51 cents higher Friday, at $114.10 a barrel. The contract lost 3% in the week, the biggest decline since the week ended Dec. 7, 2012.

Analysts at Goldman Sachs said oil prices are now "in line with fundamentals" after moving too high on "forward-looking survey data generating renewed optimism" on the global economy and oil-demand growth. The reality of "lackluster" hard data on actual demand and weak physical markets for oil brought about the selloff, the analysts said in a note.

Pressure on U.S. crude prices built when the Energy Information Administration reported domestic crude-oil stocks rose by 4.1 million barrels last week, more than twice the expected level. Stocks are now sufficient to meet nearly 27 days of current low demand from refiners, EIA data show. That is the highest level of inventory cover since March 1994, and crude-oil stocks outright are at their highest level for this time of year on EIA data beginning in 1982.

Andy Lebow, senior vice president for energy futures at Jefferies Bache, said U.S. crude now appears set to trade in a range of $90-$95 for the near term, down from the recent $95-$100 span.

Meantime, fireworks may surround the expiration of the March-delivery reformulated gasoline futures contract next week. The contract dropped 9.8 cents a gallon in the previous three days from a 20-week high, before recovering to settle 1.4% higher Friday.

Price volatility is common at this time of year as refiners walk a fine line between producing enough fuel to meet the winter-grade specification for the March contract before switching to the costlier, cleaner-burning summer-grade fuel that meets the April contract specifications.

In the last four trading days of the March 2012 contract, RBOB futures, then at a seven-month high, fell 11.05 cents, or 3.5%.

March-delivery RBOB futures rose 4.31 cents a gallon Friday, to settle at $3.0796 a gallon.

March-delivery heating oil futures, which shed 12.8 cents over the previous four sessions, settled 0.85 cent higher, at $3.1042 a gallon.

Copyright (c) 2012 Dow Jones & Company, Inc.

Generated by readers, the comments included herein do not reflect the views and opinions of Rigzone. All comments are subject to editorial review. Off-topic, inappropriate or insulting comments will be removed.

View the original article here

Crude-Oil Futures Settle Up After Steep Two-Day Losses

Crude-oil futures prices, battered in a sharp two-day selloff on demand worries, settled modestly higher Friday, while gasoline futures prices rebounded.

"It seems the blood-letting ran its course and the market's trying to catch its breath," said Gene McGillian, broker and analyst at Tradition Energy.

Front-month U.S. benchmark crude-oil futures prices dropped $4.58 a barrel in the previous two days, ending Thursday at a new 2013 low. Prices barely staggered to their feet after the two-day pounding, in which commodity funds shed their expectations of near-term higher prices, helped by a large jump in U.S. crude-oil inventories.

Market anxieties may not let up next week as the March-delivery contracts for reformulated-gasoline and heating-oil futures expire at Thursday's settlement and the March 1 deadline to break a government impasse and reach a deal to avoid $85 billion in automatic spending cuts looms. Failure to reach a deal likely would unnerve markets, traders said.

Light, sweet crude-oil futures for April delivery on the New York Mercantile Exchange settled 29 cents higher, at $93.13 a barrel. The contract fell 3.4%, the worst weekly performance for Nymex crude since Oct. 26, 2012.

April ICE Brent crude oil, which lost $3.99 over the previous two days, settled 51 cents higher Friday, at $114.10 a barrel. The contract lost 3% in the week, the biggest decline since the week ended Dec. 7, 2012.

Analysts at Goldman Sachs said oil prices are now "in line with fundamentals" after moving too high on "forward-looking survey data generating renewed optimism" on the global economy and oil-demand growth. The reality of "lackluster" hard data on actual demand and weak physical markets for oil brought about the selloff, the analysts said in a note.

Pressure on U.S. crude prices built when the Energy Information Administration reported domestic crude-oil stocks rose by 4.1 million barrels last week, more than twice the expected level. Stocks are now sufficient to meet nearly 27 days of current low demand from refiners, EIA data show. That is the highest level of inventory cover since March 1994, and crude-oil stocks outright are at their highest level for this time of year on EIA data beginning in 1982.

Andy Lebow, senior vice president for energy futures at Jefferies Bache, said U.S. crude now appears set to trade in a range of $90-$95 for the near term, down from the recent $95-$100 span.

Meantime, fireworks may surround the expiration of the March-delivery reformulated gasoline futures contract next week. The contract dropped 9.8 cents a gallon in the previous three days from a 20-week high, before recovering to settle 1.4% higher Friday.

Price volatility is common at this time of year as refiners walk a fine line between producing enough fuel to meet the winter-grade specification for the March contract before switching to the costlier, cleaner-burning summer-grade fuel that meets the April contract specifications.

In the last four trading days of the March 2012 contract, RBOB futures, then at a seven-month high, fell 11.05 cents, or 3.5%.

March-delivery RBOB futures rose 4.31 cents a gallon Friday, to settle at $3.0796 a gallon.

March-delivery heating oil futures, which shed 12.8 cents over the previous four sessions, settled 0.85 cent higher, at $3.1042 a gallon.

Copyright (c) 2012 Dow Jones & Company, Inc.

Generated by readers, the comments included herein do not reflect the views and opinions of Rigzone. All comments are subject to editorial review. Off-topic, inappropriate or insulting comments will be removed.

View the original article here

Crude Oil Futures Settle 80 Cents Higher at $96.66

Crude-oil futures prices climbed Tuesday on expectations of some easing of constraints that have kept inventories at lofty levels at a key Midwest terminal.

Traders also said U.S. benchmark crude oil futures for March delivery were higher on position adjustments ahead of the contract's expiration on Wednesday and activity was thin due to a week-long industry event in London.

The Seaway Pipeline, which carries crude oil from Cushing, Okla. to the Gulf Coast refining region, will increase flows from January levels, an executive of the company operating the line said. Operational snags on the line had restricted flows, allowing inventories to build up at Cushing, and pressure futures prices on the New York Mercantile Exchange for the U.S. benchmark contract, which is delivered at Cushing.

Enterprise Products Partners LP's (EPD) Seaway Pipeline is expected to carry an average of 295,000 barrels of oil a day between February and May, according to testimony from an executive filed with U.S. regulators. That is up from only about 180,000 barrels a day in January, the company said.

The pipeline expanded its capacity from 150,000 to 400,000 barrels a day in early January. But the amount of crude carried, or throughput, won't reach capacity for the "foreseeable future" because of the types of oil being moved, said William Ordemann, Enterprise's group senior vice president.

The remarks by the executive, filed Friday with the Federal Energy Regulatory Commission, seem to indicate that the percentage of heavy crude transported in Seaway is larger than originally thought. The nameplate capacity applies to barrels of light, sweet crude, and diminishes when larger loads of heavier crudes are shipped.

Mr. Ordemann said Seaway hopes "at some point" to increase the throughput of its line to about 335,000 barrels a day of oil, but "until Seaway has additional operating experience" with new pumping equipment, "it is not possible to say with precision when or if that will occur."

The fortunes of the U.S. benchmark and North Sea Brent, a global benchmark, recently have been tied to how much crude oil gets from the Midcontinent to the Gulf refineries. With Seaway flows increasing, domestic supplies will reach the Gulf, and compete with imports that are priced in relation to Brent.

Last October, with Cushing stocks bloated, Brent's premium to the U.S. benchmark climbed to near $24 a barrel. By January, on hopes of the Seaway expansion, the premium narrowed to below $16 a barrels. Operation snags that have prevented the line from running at capacity have allowed Brent to trade at a $20.86 a barrel premium on Tuesday.

"The market's not really catching fire today, we're just seeing some profit-taking and position adjustments," said Andy Lebow, vice president for energy futures at Jefferies Bache LLC.

Light, sweet crude oil for March-delivery on the New York Mercantile Exchange settled 80 cents higher, at $96.66 a barrel. The rise was the biggest since Feb. 11. ICE April Brent crude settled 14 cents higher at $117.52 a barrel.

While analysts see some potential for relief in Cushing stockpiles, upcoming weekly data are expected to show nationwide crude inventories rose by 2.2 million barrels last week.

Because of the Presidents Day holiday Monday, release of the inventory data is delayed by a day this week.

The closely watched government survey from the Energy Information Administration is due to be released at 11 a.m. EST Thursday, while the American Petroleum Institute, an industry group, releases its inventory report at 4:30 p.m. EST on Wednesday afternoon.

The survey is expected to show refiners trimmed operations by 0.3 percentage point from EIA's level of 83.8% of capacity last week. The lower runs are expected to trim petroleum product inventories.

Gasoline stocks are expected to drop by 800,000 barrels, while distillate stocks, comprising heating oil and diesel fuel, are expected to fall by 1.5 million barrels.

Expectations of tighter supplies have lifted the price of reformulated gasoline blendstock futures sharply, but profit-taking cut prices Tuesday. Front-month RBOB prices have gained more than 15%, or about 43 cents a gallon, since Jan. 15 amid the seasonal shift from winter-grade to summer-grade fuel.

Reformulated gasoline futures prices on the New York Mercantile Exchange, which have climbed in nine of the past 10 weeks, were off 1.33 cents, at $3.1212 a gallon, after a 20-week high Friday.

March heating oil settled 2.98 cents lower, at $3.1806 a gallon, a two-week low. The drop in dollar-terms was the biggest since Jan. 15.

Angel Gonzalez contributed to this report.

Copyright (c) 2012 Dow Jones & Company, Inc.

Generated by readers, the comments included herein do not reflect the views and opinions of Rigzone. All comments are subject to editorial review. Off-topic, inappropriate or insulting comments will be removed.

View the original article here

Crude-Oil Futures Settle Down 1.5% on Expectations of Rising Inventory

Crude-oil futures prices posted their biggest decline in a month Wednesday, falling 1.5% to $95.23 a barrel, on expectations of a seasonal drop in demand from U.S. refiners.

The decline in prices came after crude climbed nearly $3 a barrel over the previous four days, culminating with the February light, sweet crude oil futures contract on the New York Mercantile Exchange expiring Tuesday at a four-month high.

Profit-takers ruled the day, cashing in on the recent gains, and the selloff accelerated with late-session news of an operating snag on the key Seaway Pipeline, which carries oil out of the Nymex contract delivery point of Cushing, Okla., to the key Gulf Coast refining region.

Capacity on the line recently tripled to 450,000 barrels a day and helped to drive Nymex prices up by $12 a barrel since early December, on hopes that record-high stocks at Cushing would decline and the oil would fetch a higher price in the Gulf.

But operators of the line said "unforeseen constraints" have limited the flow to 175,000 barrels a day for an unspecified period.

"The key is the duration," said Andrew Lebow, senior vice president of energy futures at Jefferies Bache in New York.

The potential for U.S. crudes now bottlenecked at Cushing to compete with imports in the Gulf has lifted Nymex crude at the expense of North Sea Brent, the pricing bases for much foreign crude sent to the U.S.

"Every bank in the world has been advising buy WTI-sell Brent," Mr. Lebow said, referring to the U.S. benchmark, West Texas Intermediate crude oil.

Nymex crude oil for March delivery settled $1.45 a barrel lower, at $95.23 a barrel, the lowest price in a week. The one-day drop was the most since Dec. 21. ICE March Brent crude oil rose 38 cents, to $112.80 a barrel, the highest price since Oct. 17. Brent's premium to the U.S. benchmark of $17.57 a barrel was the highest since Jan. 14.

Mark Waggoner, president of Excel Futures in Bend, Ore., called crude-oil futures "extremely overbought" and said he expects a pullback in the next few weeks to $90 a barrel, where he would be a buyer.

Analysts surveyed by Dow Jones Newswires expect upcoming government oil-inventory data to show crude-oil stocks fell 1.7 million barrels last week, while refineries trimmed operations by 0.4 percentage point, to 87.5% of capacity. Gasoline stocks are expected to show a 900,000-barrel rise, while distillate stocks (diesel/heating oil) are expected to drop by 100,000 barrels.

The data, for the week ended Jan. 18, are set for release by the Energy Information Administration at 11 a.m. EST Thursday, a day later than usual due to the government holiday celebrated Monday.

U.S. refiners have been processing crude at a rate of nearly 15.2 million barrels a day in the first two weeks of January, while the EIA has projected a monthly average of 14.5 million barrels a day, the lowest in a year.

Rising U.S. crude-oil output, now at a 20-year high above 7 million barrels a day, has plumped up crude-oil inventories, which stand 8.8% above the five-year average level, EIA data show. Last week, crude-oil stocks were at a 30-year high for the week. Inventories at Cushing have climbed nearly 14% since early December to record levels near 52 million barrels.

Gasoline stocks last week were the highest for this time of year on records beginning in 1990 and have gained 17% in the past eight weeks. But in the New York Harbor region, the delivery point for the contract, inventories were the lowest on record for this time of year are more than 14% below the five-year average.

February-delivery reformulated gasoline blendstock futures rose for a fifth straight session, up 0.39 cent to $2.8338 a gallon, the highest settlement since Oct. 16.

Gene McGillian, broker and analyst at Tradition Energy, said the rise of more than 12 cents in RBOB futures in the past week, reflects expectation that high inventories will tighten when refinery operations slow. "We're likely to see a more extensive [maintenance] season than maybe some people anticipated," he said.

Nymex heating oil futures settled 0.99 cent higher, at $3.0781 a gallon. The fourth straight rise put prices at the highest level since Oct. 30.

Copyright (c) 2012 Dow Jones & Company, Inc.

Generated by readers, the comments included herein do not reflect the views and opinions of Rigzone. All comments are subject to editorial review. Off-topic, inappropriate or insulting comments will be removed.

View the original article here