Crude Settles at One-Month High After Modest Inventory Rise

Crude-oil futures settled at a one-month high Wednesday after a report showed U.S. oil stockpiles rose less than expected last week.

Oil inventories increased 200,000 barrels to 395.5 million barrels, the Energy Information Administration said. The rise pushed oil inventories to their highest level since the EIA began keeping weekly records in August 1982, though the gain was less than anticipated by experts and offset by a steep rise in fuel demand.

Light, sweet crude for June delivery settled $1, or 1.1%, higher at $96.62 a barrel on the New York Mercantile Exchange. That is the highest front-month settlement since April 2.

Brent crude on ICE Futures Europe settled 6 cents, or 0.1%, lower at $104.34 a barrel.

"The market got a bit excited that the inventories for crude came in below expectations," said Dominick Chirichella, analyst at the Energy Management Institute in New York. "I think it's a lot to do about nothing...we're still building and inventories and are still at record-high levels of crude oil."

Analysts surveyed by Dow Jones Newswires were calling for an inventory rise of 1.7 million barrels.

U.S. oil stockpiles have been rising steadily since the beginning of the year, fueled largely by a steady rise in domestic production. U.S. stockpiles are up roughly 10% year to date.

Market participants said they were surprised by last week's sharp pickup in demand, according to the EIA. The agency's metric for refined fuel use rose 6.5% to 19.1 million barrels a day, although demand for gasoline--the biggest component--was essentially flat.

"Without a doubt the demand number was a little more positive than we've been accustomed to seeing...but guys who are bearish on this market are bearish because of supply," said Pete Donovan, vice president at Vantage Trading, an oil options brokerage, in New York.

Oil futures have been buffeted in recent weeks by persistent signs of weak demand globally and improving global supply, but worries about the escalating civil war in Syria have kept traders on guard for supply disruptions in the Middle East. On Tuesday, unconfirmed reports of explosions in Tehran triggered a 30-cent intraday jump in the price of crude.

On Tuesday, the EIA said Saudi Arabia, the world's biggest oil producer, boosted production 1.8% last month to 9.2 million barrels a day, the highest level since December. The data also showed overall output from members of the Organization of the Petroleum Exporting Countries rose to a five-month high.

Gasoline stockpiles last week fell 900,000 barrels, according to the EIA. Distillate stocks, including heating oil and diesel, rose 1.8 million barrels. Refinery utilization rose 2.6 percentage points to 87% of capacity.

Analysts had expected gasoline stockpiles to fall 300,000 barrels, while stocks of distillates were seen rising by 400,000 barrels. Refiners were expected to increase operations by 0.4 percentage point to 84.8% of capacity.

Oil inventories at the key trading hub of Cushing, Okla., fell 700,000 barrels last week to 49.1 million barrels. A recent decline in Cushing stockpiles has helped to narrow the discount of Nymex crude versus global benchmarks like Brent crude.

The Nymex crude's discount to Brent crude recently neared $7.72 a barrel, its lowest level since January 2011.

Front-month June reformulated gasoline blendstock, or RBOB, settled 2.04 cents, or 0.7%, higher at $2.8538 a gallon. June heating oil settled 1.30 cents, or 0.4%, lower at $2.9147 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 Settles at One-Month High After Modest Inventory Rise

Crude-oil futures settled at a one-month high Wednesday after a report showed U.S. oil stockpiles rose less than expected last week.

Oil inventories increased 200,000 barrels to 395.5 million barrels, the Energy Information Administration said. The rise pushed oil inventories to their highest level since the EIA began keeping weekly records in August 1982, though the gain was less than anticipated by experts and offset by a steep rise in fuel demand.

Light, sweet crude for June delivery settled $1, or 1.1%, higher at $96.62 a barrel on the New York Mercantile Exchange. That is the highest front-month settlement since April 2.

Brent crude on ICE Futures Europe settled 6 cents, or 0.1%, lower at $104.34 a barrel.

"The market got a bit excited that the inventories for crude came in below expectations," said Dominick Chirichella, analyst at the Energy Management Institute in New York. "I think it's a lot to do about nothing...we're still building and inventories and are still at record-high levels of crude oil."

Analysts surveyed by Dow Jones Newswires were calling for an inventory rise of 1.7 million barrels.

U.S. oil stockpiles have been rising steadily since the beginning of the year, fueled largely by a steady rise in domestic production. U.S. stockpiles are up roughly 10% year to date.

Market participants said they were surprised by last week's sharp pickup in demand, according to the EIA. The agency's metric for refined fuel use rose 6.5% to 19.1 million barrels a day, although demand for gasoline--the biggest component--was essentially flat.

"Without a doubt the demand number was a little more positive than we've been accustomed to seeing...but guys who are bearish on this market are bearish because of supply," said Pete Donovan, vice president at Vantage Trading, an oil options brokerage, in New York.

Oil futures have been buffeted in recent weeks by persistent signs of weak demand globally and improving global supply, but worries about the escalating civil war in Syria have kept traders on guard for supply disruptions in the Middle East. On Tuesday, unconfirmed reports of explosions in Tehran triggered a 30-cent intraday jump in the price of crude.

On Tuesday, the EIA said Saudi Arabia, the world's biggest oil producer, boosted production 1.8% last month to 9.2 million barrels a day, the highest level since December. The data also showed overall output from members of the Organization of the Petroleum Exporting Countries rose to a five-month high.

Gasoline stockpiles last week fell 900,000 barrels, according to the EIA. Distillate stocks, including heating oil and diesel, rose 1.8 million barrels. Refinery utilization rose 2.6 percentage points to 87% of capacity.

Analysts had expected gasoline stockpiles to fall 300,000 barrels, while stocks of distillates were seen rising by 400,000 barrels. Refiners were expected to increase operations by 0.4 percentage point to 84.8% of capacity.

Oil inventories at the key trading hub of Cushing, Okla., fell 700,000 barrels last week to 49.1 million barrels. A recent decline in Cushing stockpiles has helped to narrow the discount of Nymex crude versus global benchmarks like Brent crude.

The Nymex crude's discount to Brent crude recently neared $7.72 a barrel, its lowest level since January 2011.

Front-month June reformulated gasoline blendstock, or RBOB, settled 2.04 cents, or 0.7%, higher at $2.8538 a gallon. June heating oil settled 1.30 cents, or 0.4%, lower at $2.9147 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

Nymex Crude Settles $1.62 Higher at $95.61/Bbl

Crude-oil futures rose 1.7% Friday to a one-month high as monthly jobs data showed hiring picked up in April, offering a hopeful sign for the broader economy.

The U.S. added 165,000 jobs last month, according to the Labor Department, above economists' average estimate of a 148,000 increase. The unemployment rate fell to 7.5% from 7.6%.

For energy traders, the jobs report boosted expectations that demand for gasoline and other fuels will start to pick up as the economy improves.

"With stronger jobs numbers, oil demand should be on its way," said Carl Larry, head of oil-trading newsletter Oil Outlooks and Opinions.

U.S. oil stockpiles rose to the highest level in at least three decades last week, while gasoline supplies in the high-demand Northeast U.S. are 11% above average for this time of year. If the economy picks up steam, those high levels of supplies could begin to fall.

"This puts us back on track for a much stronger economy, and in terms of energy demand, it bodes well for gasoline," said John Kilduff, founding partner of New York hedge fund Again Capital. "No matter how expensive gasoline gets, people will pay for it to drive to their job."

Light, sweet crude for June delivery settled $1.62 higher at $95.61 a barrel on the New York Mercantile Exchange, after trading as high as $96.04 a barrel earlier in the session.

Brent crude on the ICE Futures Exchange was $1.34 higher at $104.19 a barrel.

Nymex gasoline futures for June delivery settled 4.48 cents, or 1.6%, higher at $2.8254 a gallon.

The gains in oil follow a sharp rally in the previous session, when Nymex crude futures jumped 3.3%, reversing losses from earlier in the week.

Broader markets also moved higher following the jobs data, with the Dow Jones Industrial Average recently up 0.9%. Copper futures surged 6.8% to $3.3145 a pound.

Both Nymex crude and its European counterpart, Brent, have been sensitive this week to economic indicators, including disappointing data on the U.S. and Chinese economies. But on Thursday, the European Central Bank's decision to cut interest rates prompted a rally in equity markets that spilled over into the crude-oil market.

But despite Friday's gains, many analysts and traders say that the oil market remains well-supplied, which could cap any sustained price gains. And higher stockpiles in the U.S., due in part to surging domestic production, come as some overseas producers are keeping output strong.

The presidents of Sudan and South Sudan will be in place to watch the first shipment of crude oil from the south through Sudan's Port Sudan in the next few days, after a more than 15-month halt kept the countries' 350,000 barrels a day of production off the market.

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 Settles $1.62 Higher at $95.61/Bbl

Crude-oil futures rose 1.7% Friday to a one-month high as monthly jobs data showed hiring picked up in April, offering a hopeful sign for the broader economy.

The U.S. added 165,000 jobs last month, according to the Labor Department, above economists' average estimate of a 148,000 increase. The unemployment rate fell to 7.5% from 7.6%.

For energy traders, the jobs report boosted expectations that demand for gasoline and other fuels will start to pick up as the economy improves.

"With stronger jobs numbers, oil demand should be on its way," said Carl Larry, head of oil-trading newsletter Oil Outlooks and Opinions.

U.S. oil stockpiles rose to the highest level in at least three decades last week, while gasoline supplies in the high-demand Northeast U.S. are 11% above average for this time of year. If the economy picks up steam, those high levels of supplies could begin to fall.

"This puts us back on track for a much stronger economy, and in terms of energy demand, it bodes well for gasoline," said John Kilduff, founding partner of New York hedge fund Again Capital. "No matter how expensive gasoline gets, people will pay for it to drive to their job."

Light, sweet crude for June delivery settled $1.62 higher at $95.61 a barrel on the New York Mercantile Exchange, after trading as high as $96.04 a barrel earlier in the session.

Brent crude on the ICE Futures Exchange was $1.34 higher at $104.19 a barrel.

Nymex gasoline futures for June delivery settled 4.48 cents, or 1.6%, higher at $2.8254 a gallon.

The gains in oil follow a sharp rally in the previous session, when Nymex crude futures jumped 3.3%, reversing losses from earlier in the week.

Broader markets also moved higher following the jobs data, with the Dow Jones Industrial Average recently up 0.9%. Copper futures surged 6.8% to $3.3145 a pound.

Both Nymex crude and its European counterpart, Brent, have been sensitive this week to economic indicators, including disappointing data on the U.S. and Chinese economies. But on Thursday, the European Central Bank's decision to cut interest rates prompted a rally in equity markets that spilled over into the crude-oil market.

But despite Friday's gains, many analysts and traders say that the oil market remains well-supplied, which could cap any sustained price gains. And higher stockpiles in the U.S., due in part to surging domestic production, come as some overseas producers are keeping output strong.

The presidents of Sudan and South Sudan will be in place to watch the first shipment of crude oil from the south through Sudan's Port Sudan in the next few days, after a more than 15-month halt kept the countries' 350,000 barrels a day of production off the market.

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 Settles Higher on Bargain Buying after Recent Sharp Drop

Crude-oil futures prices settled higher Thursday amid bargain-hunting after a recent steep selloff, with North Sea Brent posting its first gain after six down days.

News of lower exports of Nigerian crude oil buoyed prices of European benchmark Brent crude, which had tumbled in the past six session to its lowest level since July 2. Royal Dutch Shell's (RDSA, RDSA.LN) Nigerian unit said it cut output of Bonny Light crude oil by 150,000 barrels a day and halted exports in order to resolve issues with a key oil pipeline.

Traders said an extended outage in shipments of the Brent lookalike would underpin prices of the European benchmark. But the overall supply-demand picture for oil remains weak, amid stuttering signs of economy recovery in the U.S., the world's biggest oil consumer.

"We are a slave to the economy right now and the picture's not particularly great," said Carl Larry, analyst at Oil Outlooks and Opinions.

June North Sea Brent crude oil futures on the InterContinental Exchange settled 1.5%, or $1.44, higher at $99.13 a barrel, after six days of declines. The June contract traded in a high-low range of near $10 a barrel since April 10, dropping 8%, or nearly $8.50 a barrel in the period.

May-delivery light, sweet crude oil futures on the New York Mercantile Exchange settled 1.2%, or $1.01 higher, at $88.20 a barrel, after settling Wednesday at a four-month low.

U.S. benchmark crude has dropped by more than $10 a barrel from highs in early April, as domestic crude oil and gasoline inventories have climbed, while demand for fuels remains sluggish. Front-month Brent, has fallen by about $12 a barrel this month, and the three-day string of prices below $100 a barrel is the longest since June 2012.

"We've lopped off $12 and it looks like we're wrapping up the selloff and starting to stabilize here," said Gene McGillian, broker and analyst at Tradition Energy. "But it's not that all of sudden we have confidence that the economy is improving."

The Labor Department said Thursday the number of U.S. workers applying for jobless benefits last week rose by more than economists had expected. Elsewhere, the Conference Board said its index of leading economic indicators posted an unexpected fall in March, as consumers turned gloomy on the economic outlook. The index declined 0.1% in March, its first fall since August, and counter to an expected 0.2% rise recorded in a survey of economists by Dow Jones Newswires.

U.S. gasoline demand dropped to a one-month low and was the lowest for the second week in April in 16 years, government data released on Thursday show. Demand of 8.383 million barrels a day last week was nearly 400,000 barrels a day below the year-earlier level.

The Energy Information Administration forecasted last week that gains in fuel-efficient vehicles will trim spring-summer driving season demand this year to a 12-year low of 8.877 million barrels a day.

Nymex May reformulated gasoline blendstock futures posted the first gain after falling 12%, or 37.25 cents in five of the previous six sessions to a three-month low. The contract settled up 2.65 cents, or 1%, Thursday, at $2.7555 a gallon.

Nymex May heating oil futures settled 4.45 cents, or 1.6%, higher, at $2.7791 a gallon. Prices fell 7.7% over the previous six days to the lowest level since July 2012.

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 Settles Higher on Bargain Buying after Recent Sharp Drop

Crude-oil futures prices settled higher Thursday amid bargain-hunting after a recent steep selloff, with North Sea Brent posting its first gain after six down days.

News of lower exports of Nigerian crude oil buoyed prices of European benchmark Brent crude, which had tumbled in the past six session to its lowest level since July 2. Royal Dutch Shell's (RDSA, RDSA.LN) Nigerian unit said it cut output of Bonny Light crude oil by 150,000 barrels a day and halted exports in order to resolve issues with a key oil pipeline.

Traders said an extended outage in shipments of the Brent lookalike would underpin prices of the European benchmark. But the overall supply-demand picture for oil remains weak, amid stuttering signs of economy recovery in the U.S., the world's biggest oil consumer.

"We are a slave to the economy right now and the picture's not particularly great," said Carl Larry, analyst at Oil Outlooks and Opinions.

June North Sea Brent crude oil futures on the InterContinental Exchange settled 1.5%, or $1.44, higher at $99.13 a barrel, after six days of declines. The June contract traded in a high-low range of near $10 a barrel since April 10, dropping 8%, or nearly $8.50 a barrel in the period.

May-delivery light, sweet crude oil futures on the New York Mercantile Exchange settled 1.2%, or $1.01 higher, at $88.20 a barrel, after settling Wednesday at a four-month low.

U.S. benchmark crude has dropped by more than $10 a barrel from highs in early April, as domestic crude oil and gasoline inventories have climbed, while demand for fuels remains sluggish. Front-month Brent, has fallen by about $12 a barrel this month, and the three-day string of prices below $100 a barrel is the longest since June 2012.

"We've lopped off $12 and it looks like we're wrapping up the selloff and starting to stabilize here," said Gene McGillian, broker and analyst at Tradition Energy. "But it's not that all of sudden we have confidence that the economy is improving."

The Labor Department said Thursday the number of U.S. workers applying for jobless benefits last week rose by more than economists had expected. Elsewhere, the Conference Board said its index of leading economic indicators posted an unexpected fall in March, as consumers turned gloomy on the economic outlook. The index declined 0.1% in March, its first fall since August, and counter to an expected 0.2% rise recorded in a survey of economists by Dow Jones Newswires.

U.S. gasoline demand dropped to a one-month low and was the lowest for the second week in April in 16 years, government data released on Thursday show. Demand of 8.383 million barrels a day last week was nearly 400,000 barrels a day below the year-earlier level.

The Energy Information Administration forecasted last week that gains in fuel-efficient vehicles will trim spring-summer driving season demand this year to a 12-year low of 8.877 million barrels a day.

Nymex May reformulated gasoline blendstock futures posted the first gain after falling 12%, or 37.25 cents in five of the previous six sessions to a three-month low. The contract settled up 2.65 cents, or 1%, Thursday, at $2.7555 a gallon.

Nymex May heating oil futures settled 4.45 cents, or 1.6%, higher, at $2.7791 a gallon. Prices fell 7.7% over the previous six days to the lowest level since July 2012.

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 Settles Lower on Weak Demand; Brent falls to 9-Month Low

Crude-oil futures prices fell sharply Friday, hit by growing worries over rising U.S. oil supplies and slowing growth in global oil demand.

ICE North Sea Brent crude-oil futures, a key global benchmark, dropped for a third straight day, settling at a nine-month low.

Traders said Brent is under pressure from continued worries about weakness in European economies and reduced demand caused by refinery maintenance in Europe and Asia, along with growing competition from rising U.S. oil output.

U.S. benchmark oil futures settled at five-week lows as crude oil inventories have risen to their highest level since July 1990, even as domestic refiners have lifted crude oil processing rates to the highest early April level in eight years. Those busy processers are increasing supplies of gasoline, erasing concerns about tight supplies ahead of the peak spring-summer driving season, which looks to be stuck in reverse this year due to weak demand.

Government forecasters, while warning of a slowdown in the growth of global oil consumption, expect demand for gasoline --the most widely used petroleum product in the world's biggest oil consumer--to slip to a 12-year low in the peak season. The EIA said U.S. vehicles' increased miles per gallon more than offsets the expected rise in miles traveled, the EIA said.

Spurred by the weak outlook and news that inventories in the key East Coast region now top five-year averages, traders slashed gasoline futures by 14 cents as gallon over the past three sessions, leaving prices at a three-month low on Friday.

"It's simply a supply-demand situation," said Dan Flynn, an analyst at Price Futures. "We've basically got more supply here than we know what to do with."

Light, sweet crude oil for May delivery on the New York Mercantile Exchange settled 2.4%, or $2.22 lower, at $91.29 a barrel, the lowest price since March 6.

ICE North Sea Brent for May delivery settled 1.1%, or $1.16 a barrel lower, at $103.11 a barrel, after an intraday low of $101.09 a barrel.

Forecasts this week from the U.S. Energy Information Administration, the Organization of the Petroleum Exporting Countries, and the International Energy Agency call for demand in the current quarter to drop by 180,000 to 400,000 barrels a day from the first-quarter level. That compares with a quarter-to-quarter rise at this time last year of 300,000 barrels a day, according the IEA, the energy watchdog of the major industrialized nations.

Tim Evans, analyst at Citi Futures, said prices have been hit hard by a "relatively consistent gloomy picture that is weighing on market sentiment."

Weak seasonal demand in the current quarter means, "there's simply no reason to anticipate a quick recovery," Mr. Evans said. "Demand and prices may rebound in the third quarter, but it will likely begin from a lower price level."

Analysts at Barclays said current oil-price weakness is "transient" and demand will pick up in coming months, as European refiners return from maintenance by late May and boost crude oil demand. Asian refiners are expected to wrap up seasonal work in June, providing a further lift for crude prices.

Lower global refiner demand for Brent comes as imported crudes are losing market share in the U.S. due to rising domestic output. PBF Energy Inc. said this week it plans to process up to 70,000 barrels a day of crude oil from North Dakota's Bakken shale oil region at its 190,000 barrels-a-day refnery in Delaware, a move which analyst said will lower crude imports, adding to pressure on Brent crude prices.

Gene McGillian, broker and analyst at Tradition Energy noted that U.S. crude prices have fallen by more than more than $7.50 a barrel since the April 1 high of $97.80, and said good part of the worries about the global economy may be factored into current prices.

"We may see a test of $90 a barrel, but I don't think the bears will get much more ferocious unless we get signs a further downturn," he said.

May reformulated gasoline blendstock futures settled 1%, or 2.92 cents, lower at $2.8018 a gallon, the lowest price since Jan. 18.

May heating oil futures fell 2.73 cents, to settle at $2.8719 a gallon, the lowest price since March 19.

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 Settles Lower on Cyprus Worries

Crude-oil futures prices settled weaker Thursday, knocked lower by concerns over the ongoing debt crisis in Cyprus and worries it could spread further into Europe.

Traders said high U.S. oil inventories and weak demand in the world's biggest oil consumer also kept prices down.

The European Central Bank has warned it won't extend beyond Monday the emergency funding that has kept Cypriot banks in operation while a bailout plan was being negotiated. The Cypriot Parliament rejected an earlier package that included a tax levy on bank accounts in the island nation, fueling fears of a run on banks, which have been ordered to close this week.

Worries about Cyprus sparked fears debt problems could flare anew elsewhere in Europe and have weighed on the euro, sending the common currency down against the dollar. In times of dollar strength, some investors using foreign currencies avoid dollar-based investments such as oil futures as they become pricier due to currency issues.

"Cyprus is completely unresolved" and people are becoming "a little more cautious" about buying crude-oil futures, said Peter Donovan, vice president at Vantage Trading.

Mark Waggoner, president of Excel Futures, said the oil market was overbought and in need of a correction. But he expects prices will recover once the market is no longer "spooked" over Cyprus. That front-month Nymex crude held above its 20-day average on trading charts of $92.29 a barrel signaled potential for recovery, he said.

Light, sweet crude oil for May delivery on the New York Mercantile Exchange settled 1.1%, or $1.05 lower, at $92.45 a barrel. May ICE North Sea Brent crude oil fell $1.25 to $107.47 a barrel.

For the second time this week, Brent's premium to the U.S. benchmark narrowed to the lowest level since last July. The spread was $15.02 a barrel Thursday.

Brent crude supplies have been rising after output snags have been resolved, and are facing increased competition from higher flows of similar grades of oil from West Africa. Shell said Thursday it was restoring shipments of Bonny Light crude after a pipeline was shut earlier this month after being damaged in an attempted oil theft.

At the same, more U.S. outlook is making its way to the U.S. Gulf refining region by pipeline and rail, where it competes directly with imports, putting further pressure on Brent and similar crudes.

The Energy Information Administration reported Wednesday U.S. crude-oil stocks fell by 1.3 million barrels last week, while analysts expected a 1.7-million barrel rise. The surprise decline followed nine straight weeks of increases that plumped up inventories by 24 million barrels.

But even with the decline, crude stocks, at near 383 million barrels, are unusually high and 12% above the five-year average for this time of year, the biggest surplus in two months. At the same time, the EIA said U.S. oil demand dropped last week to its lowest level since January.

April-delivery reformulated blendstock gasoline futures settled 4.57 cents lower, at $3.0706 a gallon, while April heating oil rose 0.42 cent, to settle at $2.8963 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 Settles Lower on Cyprus Worries

Crude-oil futures prices settled weaker Thursday, knocked lower by concerns over the ongoing debt crisis in Cyprus and worries it could spread further into Europe.

Traders said high U.S. oil inventories and weak demand in the world's biggest oil consumer also kept prices down.

The European Central Bank has warned it won't extend beyond Monday the emergency funding that has kept Cypriot banks in operation while a bailout plan was being negotiated. The Cypriot Parliament rejected an earlier package that included a tax levy on bank accounts in the island nation, fueling fears of a run on banks, which have been ordered to close this week.

Worries about Cyprus sparked fears debt problems could flare anew elsewhere in Europe and have weighed on the euro, sending the common currency down against the dollar. In times of dollar strength, some investors using foreign currencies avoid dollar-based investments such as oil futures as they become pricier due to currency issues.

"Cyprus is completely unresolved" and people are becoming "a little more cautious" about buying crude-oil futures, said Peter Donovan, vice president at Vantage Trading.

Mark Waggoner, president of Excel Futures, said the oil market was overbought and in need of a correction. But he expects prices will recover once the market is no longer "spooked" over Cyprus. That front-month Nymex crude held above its 20-day average on trading charts of $92.29 a barrel signaled potential for recovery, he said.

Light, sweet crude oil for May delivery on the New York Mercantile Exchange settled 1.1%, or $1.05 lower, at $92.45 a barrel. May ICE North Sea Brent crude oil fell $1.25 to $107.47 a barrel.

For the second time this week, Brent's premium to the U.S. benchmark narrowed to the lowest level since last July. The spread was $15.02 a barrel Thursday.

Brent crude supplies have been rising after output snags have been resolved, and are facing increased competition from higher flows of similar grades of oil from West Africa. Shell said Thursday it was restoring shipments of Bonny Light crude after a pipeline was shut earlier this month after being damaged in an attempted oil theft.

At the same, more U.S. outlook is making its way to the U.S. Gulf refining region by pipeline and rail, where it competes directly with imports, putting further pressure on Brent and similar crudes.

The Energy Information Administration reported Wednesday U.S. crude-oil stocks fell by 1.3 million barrels last week, while analysts expected a 1.7-million barrel rise. The surprise decline followed nine straight weeks of increases that plumped up inventories by 24 million barrels.

But even with the decline, crude stocks, at near 383 million barrels, are unusually high and 12% above the five-year average for this time of year, the biggest surplus in two months. At the same time, the EIA said U.S. oil demand dropped last week to its lowest level since January.

April-delivery reformulated blendstock gasoline futures settled 4.57 cents lower, at $3.0706 a gallon, while April heating oil rose 0.42 cent, to settle at $2.8963 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

Expiring April Nymex Crude Oil Settles Up

Crude-oil futures prices settled higher Wednesday, fueled by higher refinery processing rates and despite concerns over signs of weak gasoline demand ahead of the peak driving season.

Traders cautioned that a series of factors make the rally, which follows a steep selloff a day earlier, less meaningful that it seems on its face.

The late surge in the front-month April contract on the New York Mercantile Exchange came ahead of its expiration and likely was steered by investors making last minute adjustments. The contract went off the board at the lowest expiration day price for crude since December.

The Energy Information Administration reported U.S. crude oil stocks fell by 1.3 million barrels last week, while analysts expected a 1.7 million barrel rise. The surprise decline followed nine straight weeks of increases that plumped up inventories by 24 million barrels. Even with the decline, the surplus of crude to its five-year norms widened to a two-month high of 12%. Analysts also noted most of the drop in crude stocks occurred on the isolated West Coast, which isn't reflective of the national trend.

EIA said crude oil runs rose 520,000 barrels a day, to 14.5 million barrels a day, which is supportive for the market. But the large gain came from the week-earlier level that was the lowest in two years.

"The data was actually bearish," said Gene McGillian, broker and analyst at Tradition Energy. "We saw a draw in crude, but we also saw weak demand for gasoline" heading into the start of the spring-summer driving season.

Mr. McGillian said the main impetus for gains in oil futures was the fact fears receded over the fiscal crisis in Cyprus and how steps to address it could ripple through struggling European economies. "We've still got 380 million barrel of crude and that's a lot of oil in storage," he said. "We're not being driven higher by tight supplies at all."

Nymex April-delivery light, sweet crude oil expired 80 cents higher, at $92.96 a barrel after a late session high of $93.30 a barrel. May crude oil settled 98 cents higher, at $93.50 a barrel.

ICE North Sea Brent crude oil for May settled $1.27 higher, at $108.72 a barrel, after settling Tuesday at the lowest level since Dec. 10.

Stocks at Cushing, Okla., the delivery point for the Nymex crude oil contract, dropped by 286,000 barrels in the week to their lowest level in three months, but analysts noted inventories remain close to record highs.

"It's a little too early to say we're seeing the start of the drawdowns at Cushing," said Andy Lebow, senior vice president for energy futures at Jefferies Bache. Cushing inventories are 5.5% below the record high hit in early January, but 27%, or 10.5 million barrels, above the year-earlier level. That's the smallest year-on-year surplus since Aug. 3, 2012.

The EIA data showed implied U.S. oil demand averaged 17.765 million barrels a day, down 4.5%, or 832,000 barrels a day, from a week earlier, and the lowest since Jan. 4. Demand for gasoline, the most widely used petroleum product in the nation, fell 303,000 barrels a day in the week, to a two-month low of 8.324 million barrels a day. EIA said gasoline stocks fell 1.476 million barrels, against expectations of a 2-million barrel drop last week. Traders noted a sharp drop in imports, but James Beck, the EIA official in charge of the weekly report, said the drop was likely due to typical week-to-week swings in ship arrivals rather than a trend toward lower imports.

Goldman Sachs analysts said in a note pressures on European refinery margins will likely mean they will be pushing out more gasoline for export to the U.S. in the near term.

Reformulated gasoline blendstock futures for April rebounded sharply late in the session, but traders said the move likely reflected bargain buying after Tuesday's steep selloff.

April-delivery RBOB gasoline settled 7.12 cents higher, at $3.1163 a gallon.

April heating oil settled 2.80 cents higher, at $2.8943 a gallon. EIA said distillate stocks (heating oil/diesel) fell 672,000 barrels, near the expected 900,000-barrel drop.

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

Expiring April Nymex Crude Oil Settles Up

Crude-oil futures prices settled higher Wednesday, fueled by higher refinery processing rates and despite concerns over signs of weak gasoline demand ahead of the peak driving season.

Traders cautioned that a series of factors make the rally, which follows a steep selloff a day earlier, less meaningful that it seems on its face.

The late surge in the front-month April contract on the New York Mercantile Exchange came ahead of its expiration and likely was steered by investors making last minute adjustments. The contract went off the board at the lowest expiration day price for crude since December.

The Energy Information Administration reported U.S. crude oil stocks fell by 1.3 million barrels last week, while analysts expected a 1.7 million barrel rise. The surprise decline followed nine straight weeks of increases that plumped up inventories by 24 million barrels. Even with the decline, the surplus of crude to its five-year norms widened to a two-month high of 12%. Analysts also noted most of the drop in crude stocks occurred on the isolated West Coast, which isn't reflective of the national trend.

EIA said crude oil runs rose 520,000 barrels a day, to 14.5 million barrels a day, which is supportive for the market. But the large gain came from the week-earlier level that was the lowest in two years.

"The data was actually bearish," said Gene McGillian, broker and analyst at Tradition Energy. "We saw a draw in crude, but we also saw weak demand for gasoline" heading into the start of the spring-summer driving season.

Mr. McGillian said the main impetus for gains in oil futures was the fact fears receded over the fiscal crisis in Cyprus and how steps to address it could ripple through struggling European economies. "We've still got 380 million barrel of crude and that's a lot of oil in storage," he said. "We're not being driven higher by tight supplies at all."

Nymex April-delivery light, sweet crude oil expired 80 cents higher, at $92.96 a barrel after a late session high of $93.30 a barrel. May crude oil settled 98 cents higher, at $93.50 a barrel.

ICE North Sea Brent crude oil for May settled $1.27 higher, at $108.72 a barrel, after settling Tuesday at the lowest level since Dec. 10.

Stocks at Cushing, Okla., the delivery point for the Nymex crude oil contract, dropped by 286,000 barrels in the week to their lowest level in three months, but analysts noted inventories remain close to record highs.

"It's a little too early to say we're seeing the start of the drawdowns at Cushing," said Andy Lebow, senior vice president for energy futures at Jefferies Bache. Cushing inventories are 5.5% below the record high hit in early January, but 27%, or 10.5 million barrels, above the year-earlier level. That's the smallest year-on-year surplus since Aug. 3, 2012.

The EIA data showed implied U.S. oil demand averaged 17.765 million barrels a day, down 4.5%, or 832,000 barrels a day, from a week earlier, and the lowest since Jan. 4. Demand for gasoline, the most widely used petroleum product in the nation, fell 303,000 barrels a day in the week, to a two-month low of 8.324 million barrels a day. EIA said gasoline stocks fell 1.476 million barrels, against expectations of a 2-million barrel drop last week. Traders noted a sharp drop in imports, but James Beck, the EIA official in charge of the weekly report, said the drop was likely due to typical week-to-week swings in ship arrivals rather than a trend toward lower imports.

Goldman Sachs analysts said in a note pressures on European refinery margins will likely mean they will be pushing out more gasoline for export to the U.S. in the near term.

Reformulated gasoline blendstock futures for April rebounded sharply late in the session, but traders said the move likely reflected bargain buying after Tuesday's steep selloff.

April-delivery RBOB gasoline settled 7.12 cents higher, at $3.1163 a gallon.

April heating oil settled 2.80 cents higher, at $2.8943 a gallon. EIA said distillate stocks (heating oil/diesel) fell 672,000 barrels, near the expected 900,000-barrel drop.

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 Settles Up; Gasoline Stronger Ahead of U.S. Data

Crude-oil futures prices settled higher Tuesday, while gasoline and heating oil prices were stronger on anticipation of tightening supplies.

Prices had stumbled Monday in a broad selloff that handed equities their first triple-digit loss of the year and swept through commodities markets. After oil's biggest fall in a month, the 1.6% loss Monday was seen as a buying opportunity, analysts said.

U.S. benchmark crude prices were pulled higher by strength in prices of refined products. Inventories of gasoline and distillate fuel [heating oil/diesel] are unusually low in the Northeast and are expected to tighten further as refiners reduce operations due to seasonal maintenance work on facilities.

"The market has a momentum of its own," said Gene McGillian, broker and analyst at Tradition Energy. "The rally is starting up again" on hopes of improving economic growth which will spur a rise in oil demand, he said.

"The fundamentals are the weak spot, but this market doesn't seem to want to trade down," Mr. McGillian said, adding that gains in demand will need to be apparent soon to sustain gains.

Monday's "hard selloff was simply a correction in a bull market that has yet to fully run its course," said Jim Ritterbusch, president of Ritterbusch & Associates, an advisory firm.

Light, sweet crude oil for March delivery on the New York Mercantile Exchange settled 47 cents higher at $96.64 a barrel. ICE North Sea Brent crude oil settled 92 cents higher at $116.52 a barrel. Brent's premium to Nymex widened $19.88 a barrel, the highest level since Dec. 27.

Mr. Ritterbusch said Brent's premium to the U.S. benchmark continues to stretch because of snags on the Seaway pipeline, rather any fundamental tightness in Brent supplies.

Brent's premium to the U.S. benchmark price had been shrinking in recent weeks on the expectation that refiners in the U.S. Gulf region would need less imported crude oil of similar quality to Brent as the Seaway pipeline increased flows from the Midwest into the key refining hub. But operational problems have limited the volumes moving on the pipeline, allowing Brent to recover at the expense of the U.S. benchmark.

Analysts noted that Saudi Arabia, the world's biggest oil exporter, has scaled back its oil output by about 700,000 barrels a day since November and pumped just over 9 million barrels a day. That came amid forecasts that the world will need less oil from the Saudis and others in the Organization of the Petroleum Exporting Countries, as output from producers outside the group, led by the U.S., continues to grow.

Because of strong, persistent gains in Brent, "we feel that odds are high of some gradual uplift in Saudi production designed to restrict additional crude price gains," Mr. Ritterbusch said. Brent had topped $117 a barrel earlier Tuesday, a settlement at that level would be the highest since May 2012.

Analysts said the market is expected to take its near-term cues from the weekly U.S. oil inventory data.

A Dow Jones Newswires survey shows analysts expect data to show U.S. crude oil inventories rose by 2.9 million barrels in the week ended Friday while refiners trimmed operations relative to capacity by 0.1 percentage point.

Gasoline stocks are expected to rise by 900,000 barrels, while distillate stocks, comprising heating oil and diesel fuel, are expected to drop by 600,000 barrels.

The American Petroleum Institute, a trade group, releases its inventory data for Feb. 1 at 4:30 p.m. EDT Tuesday, while the more widely watched federal figures from the Energy Information Administration are due at 10:30 a.m. EDT Wednesday.

March-delivery heating oil futures settled at a 16-week high, gaining 3.73 cents, or 1.2%, to settle at $3.1913 a gallon.

Front-month reformulated gasoline prices rose 2.59 cents to settle at $3.0374 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 Settles Up; Gasoline Stronger Ahead of U.S. Data

Crude-oil futures prices settled higher Tuesday, while gasoline and heating oil prices were stronger on anticipation of tightening supplies.

Prices had stumbled Monday in a broad selloff that handed equities their first triple-digit loss of the year and swept through commodities markets. After oil's biggest fall in a month, the 1.6% loss Monday was seen as a buying opportunity, analysts said.

U.S. benchmark crude prices were pulled higher by strength in prices of refined products. Inventories of gasoline and distillate fuel [heating oil/diesel] are unusually low in the Northeast and are expected to tighten further as refiners reduce operations due to seasonal maintenance work on facilities.

"The market has a momentum of its own," said Gene McGillian, broker and analyst at Tradition Energy. "The rally is starting up again" on hopes of improving economic growth which will spur a rise in oil demand, he said.

"The fundamentals are the weak spot, but this market doesn't seem to want to trade down," Mr. McGillian said, adding that gains in demand will need to be apparent soon to sustain gains.

Monday's "hard selloff was simply a correction in a bull market that has yet to fully run its course," said Jim Ritterbusch, president of Ritterbusch & Associates, an advisory firm.

Light, sweet crude oil for March delivery on the New York Mercantile Exchange settled 47 cents higher at $96.64 a barrel. ICE North Sea Brent crude oil settled 92 cents higher at $116.52 a barrel. Brent's premium to Nymex widened $19.88 a barrel, the highest level since Dec. 27.

Mr. Ritterbusch said Brent's premium to the U.S. benchmark continues to stretch because of snags on the Seaway pipeline, rather any fundamental tightness in Brent supplies.

Brent's premium to the U.S. benchmark price had been shrinking in recent weeks on the expectation that refiners in the U.S. Gulf region would need less imported crude oil of similar quality to Brent as the Seaway pipeline increased flows from the Midwest into the key refining hub. But operational problems have limited the volumes moving on the pipeline, allowing Brent to recover at the expense of the U.S. benchmark.

Analysts noted that Saudi Arabia, the world's biggest oil exporter, has scaled back its oil output by about 700,000 barrels a day since November and pumped just over 9 million barrels a day. That came amid forecasts that the world will need less oil from the Saudis and others in the Organization of the Petroleum Exporting Countries, as output from producers outside the group, led by the U.S., continues to grow.

Because of strong, persistent gains in Brent, "we feel that odds are high of some gradual uplift in Saudi production designed to restrict additional crude price gains," Mr. Ritterbusch said. Brent had topped $117 a barrel earlier Tuesday, a settlement at that level would be the highest since May 2012.

Analysts said the market is expected to take its near-term cues from the weekly U.S. oil inventory data.

A Dow Jones Newswires survey shows analysts expect data to show U.S. crude oil inventories rose by 2.9 million barrels in the week ended Friday while refiners trimmed operations relative to capacity by 0.1 percentage point.

Gasoline stocks are expected to rise by 900,000 barrels, while distillate stocks, comprising heating oil and diesel fuel, are expected to drop by 600,000 barrels.

The American Petroleum Institute, a trade group, releases its inventory data for Feb. 1 at 4:30 p.m. EDT Tuesday, while the more widely watched federal figures from the Energy Information Administration are due at 10:30 a.m. EDT Wednesday.

March-delivery heating oil futures settled at a 16-week high, gaining 3.73 cents, or 1.2%, to settle at $3.1913 a gallon.

Front-month reformulated gasoline prices rose 2.59 cents to settle at $3.0374 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 Settles at Highest Level Since Mid-September

Crude-oil futures prices settled modestly higher Wednesday as gasoline-futures prices gained for a 10th straight day and the U.S. Federal Reserve voted to keep its low-interest-rate policy in place.

Crude shook off a bigger-than-expected increase in U.S. inventories in the latest week and a surprisingly weak report from the Commerce Department that showed U.S. gross domestic product declined by 0.1% in the fourth quarter, against expectations of a 1% rise. The GDP drop was the first decline in three-and-a-half years, and it briefly plunged crude into the red.

But the raucous rally in reformulated gasoline blendstock futures continued for a 10th day as gasoline inventories in the key Mid-Atlantic region remain about 15% below their five-year average level for this time of year. The Energy Information Administration reported that implied demand for gasoline and distillate fuel--diesel and heating oil--rose last week from recently depressed levels.

Light, sweet crude oil for March delivery on the New York Mercantile Exchange settled up 37 cents at $97.94 a barrel, the highest level since Sept. 14. That date, nearly 20 weeks ago, was the last time Nymex crude traded to $100 a barrel. ICE Brent crude for March settled 54 cents higher, at $114.90 a barrel, the highest price since Oct. 16.

Gene McGillian, broker and analyst at Tradition Energy, said prices may soon test $100 a barrel, but strong signs of improving oil demand will be needed to keep further gains.

"The way we shrugged off the GDP figure and the near-6-million-barrel build in crude stocks, the market clearly has that level in its sites," he said. "The global economy is slowly improving, and energy demand needs to pick up with it."

Analysts said the Fed's continuing policy of market stimulus is a positive signal for the market. "That fact is, a lot of the rally that we've had in the energy market is because of the easy money policies we've seen from the world's central bank," Mr. McGillian said.

Petroleum products prices have rallied in recent days on expectations that heavy season refinery maintenance work this quarter will tighten inventories of refined products like gasoline and heating oil.

February-delivery contracts for reformulated gasoline blendstock settled 6.53 cents, or 2.2%, higher, at $3.0387 a gallon. The contract expires at Thursday's settlement. The penny-for-penny gain was the most since Nov. 9, while the percentage increase was the biggest since Dec. 26. Wednesday's price marked the highest-ever settlement price for gasoline during January, when prices are most often the weakest of the year. In 28 years of trading gasoline futures on the Nymex, the average front-month gasoline price during January has been the lowest for the year 10 times, more than any other month.

The RBOB contract has gained 33.21 cents, or 12.3%, in the past 10 days, which is the longest stretch of consecutive gains since July 2009.

Heating oil for February delivery settled 0.81 cent higher, at $3.1173 a gallon, the most since Oct. 19. The contract has gained 2% in the last three sessions and also expires at Thursday's settlement.

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

Friday's mining news: Afferro settles tax dispute

Afferro Mining settled a Liberian tax dispute, while Jubilee Platinum announced a tailings-processing agreement in South Africa.

Afferro settles Liberian tax dispute with $10 million payment

Afferro Mining (AFF) has announced the signature of a compromise and settlement agreement with the Liberian government in relation to outstanding tax claims made by the government. The claim relates to the sale of Afferro's 38.5% minority interest in Severstal Liberia Iron Ore to Lybica, an affiliate of Severstal.

The parties have agreed that a single payment of $9.8 million (

View the Original article