MARKETWATCH
"U.S. and Brent crude reach highest settlements in nearly 4 years"
By Myra P. Saefong and Mark DeCambre
Published: Oct 1, 2018 3:28 p.m. ET
Oil futures rallied by almost 3% on Monday, lifting both U.S. and global benchmark crude to their highest price settlements in nearly four years.
Michael Lynch, president of Strategic Energy & Economic Research, told MarketWatch he was surprised by the strength of Monday’s rally, but believes that prices got a boost from the pending trade agreement between the U.S., Canada and Mexico, as well as “growing attention on the possibility that we’ll hit $100,” a barrel.
Still, “almost any bearish news should see a sell off” in prices, he said.
November West Texas Intermediate crude, the U.S. benchmark, rose $2.05, or 2.8%, to settle at $75.30 a barrel on the New York Mercantile Exchange.
December Brent crude rose $2.25, or 2.7%, to mark a finish at $84.98 a barrel on the ICE Futures Europe exchange, after tapping a high of $85.40.
WTI marked its highest front-month contract settlement since late November 2014, while Brent finish at its highest since late October 2014, according to FactSet data.
Monday’s moves come after Brent crude posted a weekly gain of 5%, based on the front-month contract, while WTI oil saw a weekly climb of 3.5%, according to Dow Jones Market Data.
For the month, Brent advanced 6.8%, while the U.S. contract returned 4.9% in September.
However, based on the settlement of $74.15 for the front-month contract at the end of June, WTI ended down 1.2% for the three-month period ended last week, while Brent booked a quarterly gain of 4.1%.
News that the U.S. and Canada reached a preliminary deal to revise the North American Free Trade Agreement contributed to the latest rise in oil prices.
The agreement eased concerns that trade tensions would hurt demand for oil.
Meanwhile, the market is “still turning a nervous eye towards Iranian production losses,” said Robbie Fraser, commodity analyst at Schneider Electric, in a daily note.
“While official U.S. sanctions against Iranian oil exports are still just over a month away, Iran’s exports have already declined by at least 30% according to multiple estimates, as foreign buyers look elsewhere to source oil.”
Crude’s rally over the past few months have been buoyed by declining Iranian crude exports ahead of U.S. economic sanctions against the Islamic Republic’s oil industry, set to take effect Nov. 4, analysts say.
Officials at the state-run National Iranian Oil Co. have said they provisionally expect crude shipments to have dropped to about 1.5 million barrels a day this month, compared with 2.3 million barrels a day in June, according to people familiar with the matter.
With the fall in Iranian exports “expected to accelerate in the months ahead, the market turns to spare capacity in order to maintain market balance, which means a heavy focus on both the U.S. and Saudi Arabia,” said Fraser.
On Friday, however, Baker Hughes reported a second straight weekly decline in active U.S. rigs drilling for oil, hinting at a decline in oil output activity.
President Donald Trump in May pulled the U.S. out of a 2015 international agreement to curb Iran’s nuclear program, setting the stage for the reimposition of economic sanctions next month.
Prices on Friday saw a sudden jump with some market participants partly attributing the moves to support from reports that China is cutting back on Iranian oil purchases.
Back on Nymex Monday, November gasoline added 2% to about $2.128 a gallon and November heating oil rose 2.5% to $2.408 a gallon.
November natural gas settled up 2.9% at $3.094 per million British thermal unit— the highest finish since January.
“Winter [natural-gas] contracts continue to extend their risk premium, with an already low storage situation amplified by a considerably weaker-than-expected [supply] injection announced last week” by the U.S. Energy Information Administration, Fraser said.
https://www.marketwatch.com/story/oil-a ... ewer_click
OIL, NATURAL GAS
Re: OIL, NATURAL GAS
MARKETWATCH
"Oil eases back from 4-year highs with data expected to show a weekly rise in U.S. crude supplies"
By Myra P. Saefong and Mark DeCambre
Published: Oct 2, 2018 3:25 p.m. ET
Oil futures end a few cents lower on Tuesday, a day after reported declines in Iranian exports and a preliminary trade agreement between the U.S., Canada and Mexico contributed to a rise in global and U.S. prices to their highest levels in nearly four years.
Investors awaited weekly data, due early Wednesday, that are expected to reveal a second straight climb in U.S. crude inventories.
November West Texas Intermediate crude, the U.S. benchmark, fell 7 cents, or less than 0.1%, to settle at $75.23 a barrel on the New York Mercantile Exchange.
December Brent fell by 18 cents, or 0.2%, to finish at $84.80 a barrel on the ICE Futures Europe exchange.
On Monday, both contracts settled at around their highest levels since the fall of 2014, according to FactSet data.
The American Petroleum Institute, a trade group, will release its weekly petroleum supply report late Tuesday, covering the week ended Sept. 28.
The official government data from Energy Information Administration will come out Wednesday morning.
The figures come as refineries are conducting season maintenance, which could lead to higher oil inventories, but oil supply may also fall given that the “export window is wide open,” said Phil Flynn, senior market analyst at Price Futures Group.
Analysts polled by S&P Global Platts expect the EIA to report a weekly rise of 2.76 million for domestic crude supplies.
That would the second weekly climb in a row reported by the EIA.
Supplies of gasoline were forecast to fall by 672,000 barrels, while distillates were seen down 1.83 million barrels, the survey said.
Last week, the EIA report showed that domestic crude supplies rose by 1.9 million barrels for the week ended Sept. 21, marking the first climb in six weeks.
On Nymex Tuesday, November gasoline fell less than a penny to $2.127 a gallon and November heating oil ended little changed at $2.408 a gallon.
Natural-gas prices, meanwhile, extended their sharp rise from a day earlier, with November natural gas settling at $3.166 per million British thermal units, up 2.3%.
It notched another finish at its highest since January.
“Unusually low storage levels continue to signal potential volatility and upside risk for front-month contracts through winter,” said Robbie Fraser, commodity analyst at Schneider Electric.
Oil traders have attributed a recent rally in crude to declining Iranian exports, which have come ahead of oil-specific U.S. sanctions against Tehran that are set to take effect early next month.
Data from Bloomberg based on tanker-tracking reports, indicate that Iranian crude shipments dropped to 1.72 million barrels a day in September, down 260,000 barrels a day from August, and representing the lowest levels since February 2016.
President Donald Trump in May pulled the U.S. out of a 2015 international agreement to curb Iran’s nuclear program, setting the stage for the reimposition of economic sanctions in November.
Matt Smith, director of commodity research at ClipperData told MarketWatch that the dollar’s strength, with the ICE U.S. Dollar Index gaining 0.3%, was creating some resistance for oil on Tuesday.
Prices had climbed Monday as an updated North American Free Trade Agreement, now slated to be called the U.S.-Mexico-Canada Agreement, or USMCA, boosted expectations for oil demand.
Global stocks, however, were slumping on mounting worries about a possible clash between Italy and the European Union, which could hurt the EU economy and oil appetite.
https://www.marketwatch.com/story/us-oi ... 2018-10-02
"Oil eases back from 4-year highs with data expected to show a weekly rise in U.S. crude supplies"
By Myra P. Saefong and Mark DeCambre
Published: Oct 2, 2018 3:25 p.m. ET
Oil futures end a few cents lower on Tuesday, a day after reported declines in Iranian exports and a preliminary trade agreement between the U.S., Canada and Mexico contributed to a rise in global and U.S. prices to their highest levels in nearly four years.
Investors awaited weekly data, due early Wednesday, that are expected to reveal a second straight climb in U.S. crude inventories.
November West Texas Intermediate crude, the U.S. benchmark, fell 7 cents, or less than 0.1%, to settle at $75.23 a barrel on the New York Mercantile Exchange.
December Brent fell by 18 cents, or 0.2%, to finish at $84.80 a barrel on the ICE Futures Europe exchange.
On Monday, both contracts settled at around their highest levels since the fall of 2014, according to FactSet data.
The American Petroleum Institute, a trade group, will release its weekly petroleum supply report late Tuesday, covering the week ended Sept. 28.
The official government data from Energy Information Administration will come out Wednesday morning.
The figures come as refineries are conducting season maintenance, which could lead to higher oil inventories, but oil supply may also fall given that the “export window is wide open,” said Phil Flynn, senior market analyst at Price Futures Group.
Analysts polled by S&P Global Platts expect the EIA to report a weekly rise of 2.76 million for domestic crude supplies.
That would the second weekly climb in a row reported by the EIA.
Supplies of gasoline were forecast to fall by 672,000 barrels, while distillates were seen down 1.83 million barrels, the survey said.
Last week, the EIA report showed that domestic crude supplies rose by 1.9 million barrels for the week ended Sept. 21, marking the first climb in six weeks.
On Nymex Tuesday, November gasoline fell less than a penny to $2.127 a gallon and November heating oil ended little changed at $2.408 a gallon.
Natural-gas prices, meanwhile, extended their sharp rise from a day earlier, with November natural gas settling at $3.166 per million British thermal units, up 2.3%.
It notched another finish at its highest since January.
“Unusually low storage levels continue to signal potential volatility and upside risk for front-month contracts through winter,” said Robbie Fraser, commodity analyst at Schneider Electric.
Oil traders have attributed a recent rally in crude to declining Iranian exports, which have come ahead of oil-specific U.S. sanctions against Tehran that are set to take effect early next month.
Data from Bloomberg based on tanker-tracking reports, indicate that Iranian crude shipments dropped to 1.72 million barrels a day in September, down 260,000 barrels a day from August, and representing the lowest levels since February 2016.
President Donald Trump in May pulled the U.S. out of a 2015 international agreement to curb Iran’s nuclear program, setting the stage for the reimposition of economic sanctions in November.
Matt Smith, director of commodity research at ClipperData told MarketWatch that the dollar’s strength, with the ICE U.S. Dollar Index gaining 0.3%, was creating some resistance for oil on Tuesday.
Prices had climbed Monday as an updated North American Free Trade Agreement, now slated to be called the U.S.-Mexico-Canada Agreement, or USMCA, boosted expectations for oil demand.
Global stocks, however, were slumping on mounting worries about a possible clash between Italy and the European Union, which could hurt the EU economy and oil appetite.
https://www.marketwatch.com/story/us-oi ... 2018-10-02
Re: OIL, NATURAL GAS
MARKETWATCH
"API data reportedly show a second straight weekly rise in U.S. crude supplies"
By Myra P. Saefong
Published: Oct 2, 2018 4:43 p.m. ET
The American Petroleum Institute reported that U.S. crude supplies rose by 907,000 barrels for the week ended Sept. 28, according to sources.
The API data also showed supplies of gasoline declined by 1.7 million barrels and distillates fell by 1.2 million barrels, sources said.
Supply data from the Energy Information Administration will be released Wednesday.
Analysts polled by S&P Global Platts expect the EIA to report a climb of 2.76 million barrels in crude supplies.
They also expect supply declines of 672,000 barrels in gasoline and 1.83 million barrels in distillates.
November crude was at $75.06 a barrel in electronic trading, down a bit from the $75.23 settlement on the New York Mercantile Exchange.
https://www.marketwatch.com/story/api-d ... ewer_click
"API data reportedly show a second straight weekly rise in U.S. crude supplies"
By Myra P. Saefong
Published: Oct 2, 2018 4:43 p.m. ET
The American Petroleum Institute reported that U.S. crude supplies rose by 907,000 barrels for the week ended Sept. 28, according to sources.
The API data also showed supplies of gasoline declined by 1.7 million barrels and distillates fell by 1.2 million barrels, sources said.
Supply data from the Energy Information Administration will be released Wednesday.
Analysts polled by S&P Global Platts expect the EIA to report a climb of 2.76 million barrels in crude supplies.
They also expect supply declines of 672,000 barrels in gasoline and 1.83 million barrels in distillates.
November crude was at $75.06 a barrel in electronic trading, down a bit from the $75.23 settlement on the New York Mercantile Exchange.
https://www.marketwatch.com/story/api-d ... ewer_click
Re: OIL, NATURAL GAS
MARKETWATCH
"Oil prices rally back to nearly 4-year highs despite biggest weekly U.S. crude supply rise of the year"
By Myra P. Saefong and Mark DeCambre
Published: Oct 3, 2018 3:19 p.m. ET
Oil futures rallied on Wednesday as reported declines in Iranian exports due to pending U.S. oil sanctions and uncertainty surrounding the ability of other major oil producers to make up for the loss, lifted U.S. and global prices back to nearly four-year highs.
The strong gains came despite data from the U.S. government which revealed the largest weekly rise of the year in U.S. crude inventories.
“The market is having problems reconciling the supply risk from Iran and questions about how much Saudis will pump and a bearish report,” James Williams, energy economist at WTRG Economics, told MarketWatch.
“It’s like the traders are on two sides of the conference table, with one group saying look at the bearish report and the other saying it was just one week’s numbers, and the Iran and Saudi uncertainty remains,” he said.
“If the Saudis spike production up then a lot of spare capacity disappears and low spare capacity means greater risk.”
“You need an image of Doctor Dolittle’s pushmi-pullyu,” he added, referring to a fictional animal from the 1960s movie—a llama with two heads on opposite sides of its body.
November West Texas Intermediate crude, the U.S. benchmark contract, added $1.18, or 1.6%, to settle at $76.41 a barrel on the New York Mercantile Exchange, but had dropped near the day’s low of $74.30 immediately after the supply data.
December Brent rose $1.49, or 1.8%, to $86.29 a barrel on the ICE Futures Europe exchange after tapping lows near $84.
Both benchmark contracts marked their highest settlements since late 2014.
The Energy Information Administration reported Wednesday that domestic crude supplies surged by 8 million barrels for the week ended Sept. 28—the largest weekly climb year to date.
“The 8 million-barrel build in crude was due to a 917,000 [barrel per day] drop in exports, aided by a 163,000 b/d increase in imports,” said Williams.
The previous week’s increase of 1.9 million barrels in crude stocks had followed five consecutive weeks of declines.
Analysts surveyed by S&P Global Platts had forecast a rise of 2.76 million barrels, while the American Petroleum Institute on Tuesday reported a climb of 907,000 barrels in crude stockpiles.
Gasoline stockpiles fell by 500,000 barrels last week, while distillate stockpiles declined by 1.8 million barrels, according to the EIA.
The S&P Global Platts survey had shown expectations for supply declines of 672,000 barrels in gasoline and 1.83 million barrels in distillates.
Prices for petroleum futures climbed along with oil Wednesday.
November gasoline rose 0.5% to $2.138 a gallon and November heating oil settled at $2.437 a gallon, up 1.2%.
“The only thing keeping crude from a large move down is the upcoming Iran sanctions, which are going to be implemented in November,” said Tariq Zahir, managing member at Tyche Capital Advisors.
The Trump administration’s decision to pull out of a 2015 international agreement to curb Iran’s nuclear program, and a reimposition of economic sanctions on the third-largest producer of crude—set to kick in next month—has helped to drive oil prices higher because the Organization of the Petroleum Exporting Countries isn’t expected to be able to match the country’s lost output.
In a further escalation of relations with Iran, U.S. Secretary of State Mike Pompeo announced Wednesday that the U.S. is terminating the 1955 Treaty of Amity, after a United Nations court said the treaty prevented the U.S. from imposing sanctions that affect humanitarian aid.
Elsewhere in energy trading, natural-gas prices tallied a third straight session climb—again settling at their highest since January.
“Hot temperatures leading to higher-than-normal air conditioning use for this time of year is helping drive this week’s rally,” said Tyler Richey, co-editor of the Sevens Report.
“This breakout has been a long time in the making as inventories remain notably below their five-year and one-year averages.”
November natural gas added 2% to $3.23 per million British thermal units.
https://www.marketwatch.com/story/oil-p ... 2018-10-03
"Oil prices rally back to nearly 4-year highs despite biggest weekly U.S. crude supply rise of the year"
By Myra P. Saefong and Mark DeCambre
Published: Oct 3, 2018 3:19 p.m. ET
Oil futures rallied on Wednesday as reported declines in Iranian exports due to pending U.S. oil sanctions and uncertainty surrounding the ability of other major oil producers to make up for the loss, lifted U.S. and global prices back to nearly four-year highs.
The strong gains came despite data from the U.S. government which revealed the largest weekly rise of the year in U.S. crude inventories.
“The market is having problems reconciling the supply risk from Iran and questions about how much Saudis will pump and a bearish report,” James Williams, energy economist at WTRG Economics, told MarketWatch.
“It’s like the traders are on two sides of the conference table, with one group saying look at the bearish report and the other saying it was just one week’s numbers, and the Iran and Saudi uncertainty remains,” he said.
“If the Saudis spike production up then a lot of spare capacity disappears and low spare capacity means greater risk.”
“You need an image of Doctor Dolittle’s pushmi-pullyu,” he added, referring to a fictional animal from the 1960s movie—a llama with two heads on opposite sides of its body.
November West Texas Intermediate crude, the U.S. benchmark contract, added $1.18, or 1.6%, to settle at $76.41 a barrel on the New York Mercantile Exchange, but had dropped near the day’s low of $74.30 immediately after the supply data.
December Brent rose $1.49, or 1.8%, to $86.29 a barrel on the ICE Futures Europe exchange after tapping lows near $84.
Both benchmark contracts marked their highest settlements since late 2014.
The Energy Information Administration reported Wednesday that domestic crude supplies surged by 8 million barrels for the week ended Sept. 28—the largest weekly climb year to date.
“The 8 million-barrel build in crude was due to a 917,000 [barrel per day] drop in exports, aided by a 163,000 b/d increase in imports,” said Williams.
The previous week’s increase of 1.9 million barrels in crude stocks had followed five consecutive weeks of declines.
Analysts surveyed by S&P Global Platts had forecast a rise of 2.76 million barrels, while the American Petroleum Institute on Tuesday reported a climb of 907,000 barrels in crude stockpiles.
Gasoline stockpiles fell by 500,000 barrels last week, while distillate stockpiles declined by 1.8 million barrels, according to the EIA.
The S&P Global Platts survey had shown expectations for supply declines of 672,000 barrels in gasoline and 1.83 million barrels in distillates.
Prices for petroleum futures climbed along with oil Wednesday.
November gasoline rose 0.5% to $2.138 a gallon and November heating oil settled at $2.437 a gallon, up 1.2%.
“The only thing keeping crude from a large move down is the upcoming Iran sanctions, which are going to be implemented in November,” said Tariq Zahir, managing member at Tyche Capital Advisors.
The Trump administration’s decision to pull out of a 2015 international agreement to curb Iran’s nuclear program, and a reimposition of economic sanctions on the third-largest producer of crude—set to kick in next month—has helped to drive oil prices higher because the Organization of the Petroleum Exporting Countries isn’t expected to be able to match the country’s lost output.
In a further escalation of relations with Iran, U.S. Secretary of State Mike Pompeo announced Wednesday that the U.S. is terminating the 1955 Treaty of Amity, after a United Nations court said the treaty prevented the U.S. from imposing sanctions that affect humanitarian aid.
Elsewhere in energy trading, natural-gas prices tallied a third straight session climb—again settling at their highest since January.
“Hot temperatures leading to higher-than-normal air conditioning use for this time of year is helping drive this week’s rally,” said Tyler Richey, co-editor of the Sevens Report.
“This breakout has been a long time in the making as inventories remain notably below their five-year and one-year averages.”
November natural gas added 2% to $3.23 per million British thermal units.
https://www.marketwatch.com/story/oil-p ... 2018-10-03
Re: OIL, NATURAL GAS
MARKETWATCH
"U.S. oil drops nearly 3% on domestic stockpile surge, talk of efforts to raise output"
By Myra P. Saefong and Rachel Koning Beals
Published: Oct 4, 2018 3:19 p.m. ET
Oil futures settled lower on Thursday, with the U.S. benchmark suffering its largest one-day percentage decline since mid-August.
“Fundamental dynamics have shifted in favor of the bears this week with a huge build in commercial crude oil stocks and news that Saudi Arabia and Russia made a private agreement weeks ago to increase output to help offset the declining exports from Iran,” said Tyler Richey, co-editor of the Sevens Report.
November West Texas Intermediate crude, the U.S. benchmark contract, lost $2.08, or 2.7%, to settle at $74.33 a barrel on the New York Mercantile Exchange.
That was the biggest one-day percentage decline since mid-August.
December Brent fell $1.71, or 2%, to $84.58 a barrel on ICE Futures Europe.
Uncertainty over whether major oil producers would be able to make up for the loss of Iranian exports to U.S. sanctions that kick in next month were among the factors driving prices higher Wednesday, when WTI topped $76 and Brent climbed above $86.
That increase came despite the largest weekly U.S. crude inventory build in more than 18 months, Riche said, “so from a fundamentals standpoint, the threat of looming sanction on Iran has been the only bullish influence this week.”
The Energy Information Administration reported Wednesday that domestic crude supplies surged by 8 million barrels for the week ended Sept. 28.
The Trump administration’s decision to pull out of a 2015 international agreement to curb Iran’s nuclear program, and a reimposition of economic sanctions on the third-largest producer of crude set to kick in next month have helped to drive oil prices higher.
In a further escalation of relations with Iran, U.S. Secretary of State Mike Pompeo announced Wednesday that the U.S. is terminating the 1955 Treaty of Amity, after a United Nations court said it prevented the U.S. from imposing sanctions that affect humanitarian aid.
That puts much attention on mega producer Saudi Arabia, the de facto leader of the Organization of the Petroleum Exporting Countries.
The kingdom’s energy minister, Khalid al-Falih, announced that Saudi oil production would rise in October to 10.7 million barrels a day.
That would be a record level, noted analysts at Commerzbank.
A Reuters survey showed that Saudi Arabia was still producing 10.53 million barrels a day in September, they pointed out.
On top of that, according to data from the Russian Ministry of Energy, Russia already stepped up its oil production to a record-high 11.36 million barrels a day in September.
But the Commerzbank analysts questioned the lasting effect of these moves.
“The increased production in both countries is consistent with a bilateral agreement reached at the meeting in Algiers at the end of September,” the analysts said.
They pointed to a Reuters report this week that Saudi Arabia and Russia agreed in a private deal to expand oil production.
Originally, the plan had apparently been to officially announce a production increase of 500,000 barrels per day, but this met with opposition from a number of countries, including Iran.
“This, coupled with the fact that news of it is only emerging now, considerably reduces the impact of the bilateral agreement,” Commerzbank said in its note.
“One has the impression that production is being scaled up only halfheartedly, which raises questions about oil producer’s ability to react more proactively.”
In other energy dealings Thursday, November gasoline fell nearly 1.8% to $2.10 a gallon and November heating oil settled at $2.40 a gallon, down 1.5%.
Natural-gas prices finished lower as well, to log their first decline in four sessions after settling Wednesday at their highest since January.
The EIA Thursday reported that domestic supplies of natural gas rose by 98 billion cubic feet for the week ended Sept. 28.
That was bigger than the 85 billion-cubic-foot increase expected by analysts polled by S&P Global Platts.
November natural gas lost 2% to $3.165 per million British thermal units.
https://www.marketwatch.com/story/oil-p ... 2018-10-04
"U.S. oil drops nearly 3% on domestic stockpile surge, talk of efforts to raise output"
By Myra P. Saefong and Rachel Koning Beals
Published: Oct 4, 2018 3:19 p.m. ET
Oil futures settled lower on Thursday, with the U.S. benchmark suffering its largest one-day percentage decline since mid-August.
“Fundamental dynamics have shifted in favor of the bears this week with a huge build in commercial crude oil stocks and news that Saudi Arabia and Russia made a private agreement weeks ago to increase output to help offset the declining exports from Iran,” said Tyler Richey, co-editor of the Sevens Report.
November West Texas Intermediate crude, the U.S. benchmark contract, lost $2.08, or 2.7%, to settle at $74.33 a barrel on the New York Mercantile Exchange.
That was the biggest one-day percentage decline since mid-August.
December Brent fell $1.71, or 2%, to $84.58 a barrel on ICE Futures Europe.
Uncertainty over whether major oil producers would be able to make up for the loss of Iranian exports to U.S. sanctions that kick in next month were among the factors driving prices higher Wednesday, when WTI topped $76 and Brent climbed above $86.
That increase came despite the largest weekly U.S. crude inventory build in more than 18 months, Riche said, “so from a fundamentals standpoint, the threat of looming sanction on Iran has been the only bullish influence this week.”
The Energy Information Administration reported Wednesday that domestic crude supplies surged by 8 million barrels for the week ended Sept. 28.
The Trump administration’s decision to pull out of a 2015 international agreement to curb Iran’s nuclear program, and a reimposition of economic sanctions on the third-largest producer of crude set to kick in next month have helped to drive oil prices higher.
In a further escalation of relations with Iran, U.S. Secretary of State Mike Pompeo announced Wednesday that the U.S. is terminating the 1955 Treaty of Amity, after a United Nations court said it prevented the U.S. from imposing sanctions that affect humanitarian aid.
That puts much attention on mega producer Saudi Arabia, the de facto leader of the Organization of the Petroleum Exporting Countries.
The kingdom’s energy minister, Khalid al-Falih, announced that Saudi oil production would rise in October to 10.7 million barrels a day.
That would be a record level, noted analysts at Commerzbank.
A Reuters survey showed that Saudi Arabia was still producing 10.53 million barrels a day in September, they pointed out.
On top of that, according to data from the Russian Ministry of Energy, Russia already stepped up its oil production to a record-high 11.36 million barrels a day in September.
But the Commerzbank analysts questioned the lasting effect of these moves.
“The increased production in both countries is consistent with a bilateral agreement reached at the meeting in Algiers at the end of September,” the analysts said.
They pointed to a Reuters report this week that Saudi Arabia and Russia agreed in a private deal to expand oil production.
Originally, the plan had apparently been to officially announce a production increase of 500,000 barrels per day, but this met with opposition from a number of countries, including Iran.
“This, coupled with the fact that news of it is only emerging now, considerably reduces the impact of the bilateral agreement,” Commerzbank said in its note.
“One has the impression that production is being scaled up only halfheartedly, which raises questions about oil producer’s ability to react more proactively.”
In other energy dealings Thursday, November gasoline fell nearly 1.8% to $2.10 a gallon and November heating oil settled at $2.40 a gallon, down 1.5%.
Natural-gas prices finished lower as well, to log their first decline in four sessions after settling Wednesday at their highest since January.
The EIA Thursday reported that domestic supplies of natural gas rose by 98 billion cubic feet for the week ended Sept. 28.
That was bigger than the 85 billion-cubic-foot increase expected by analysts polled by S&P Global Platts.
November natural gas lost 2% to $3.165 per million British thermal units.
https://www.marketwatch.com/story/oil-p ... 2018-10-04
Re: OIL, NATURAL GAS
MARKETWATCH
"U.S. oil ends nearly flat, as Brent declines, but both benchmarks tally fourth weekly climb in a row"
By Myra P. Saefong and Mark DeCambre
Published: Oct 5, 2018 3:25 p.m. ET
U.S. oil prices ended nearly flat on Friday and global crude finished lower, as the market continued to question the ability of the world’s major producers to make up for losses of Iranian crude exports tied to pending U.S. sanctions.
Still, both crude benchmarks tallied a fourth weekly advance in a row.
Both had marked their highest settlements in nearly four years on Wednesday.
November West Texas Intermediate crude, the U.S. benchmark contract, tacked on a penny to settle at $74.34 a barrel on the New York Mercantile Exchange.
It settled at a nearly four-year high of $76.41 on Wednesday, but notched its biggest one-day percentage decline since mid-August on Thursday.
December Brent lost 42 cents, or 0.5%, to end at $84.16 a barrel on ICE Futures Europe.
For the week, based on front-month contracts, WTI rose 1.5%, while Brent crude advanced by 1.7%.
The Organization of the Petroleum Exporting Countries 15 members raised their crude-oil output in September to 33.07 million barrels a day—a 180,000-barrel-a-day rise from August, according to an S&P Global Platts survey of analysts, industry officials and shipping data released Friday.
The survey said “that is the most OPEC has pumped since July 2017, if the Republic of Congo, which joined the organization in June, is not included.”
The figures also show that OPEC and its 10 non-OPEC partners, led by Russia, “have surpassed their stated aim of raising production by a combined 1 million b/d from May levels.”
Herman Wang, senior writer, oil news at S&P Global Platts, pointed out to MarketWatch that OPEC, plus Russia, have surpassed the 1 million-barrel-a-day output rise, but “OPEC on its own is 850,000 [barrels a day] above its May level.”
OPEC had agreed in June to rein in member production cuts that began in January 2017.
“There are definitely dark storm clouds ahead for the market, with Iranian and Venezuelan production on a downward spiral,” said Wang.
“It appears OPEC and its allies are going to have to do more, to avoid the price spike that President [Donald] Trump is fretting, but there’s significant doubt about how much OPEC is willing and able to pump.”
Trump’s decision to pull out of a 2015 international agreement to curb Iran’s nuclear program, and a reimposition of economic sanctions on the third-largest producer of crude set to kick next month have been pivotal in driving crude futures to recent multiyear peaks.
Uncertainty remains over whether major oil producers, including members of OPEC and key non-OPEC members, like Russia, have the spare capacity to make up for the loss of Iranian exports.
“The two key uncertainties the oil market has to grapple with are first the spare capacity to replace Iranian barrels and, second, the unknown magnitude of these lost volumes due to a lack of clarity from the U.S. administration,” wrote Goldman Sachs commodity analysts, including Damien Courvalin and Jeffrey Currie, in a recent research note.
Goldman estimates a loss of 1.5 million barrels a day in the fourth quarter from the sanctions, but the analysts “acknowledge that the uncertainty on the size of the disruption will only start to be lifted after Nov. 4 when the sanctions go into effect.”
Meanwhile, monthly data on U.S. employment were mixed, providing little guidance for oil in terms of health of the economy and demand for crude.
The U.S. unemployment rate sank to 3.7% in September, while the economy added 134,000 new jobs—the smallest increase in 12 months.
Data from Baker Hughes on Friday showed that the number of active U.S. rigs drilling for oil, a key barometer of activity in the sector, fell by 2 to 861 this week.
That marked a third consecutive weekly decline.
Back on Nymex, petroleum-product futures ended lower, with November gasoline down 0.7% at $2.086 a gallon and November heating oil losing 0.3% at $2.392 a gallon.
Both finished higher for the week.
November natural gas shed 0.7% to $3.143 per million British thermal units, but saw a weekly rise of 4.5%.
https://www.marketwatch.com/story/oil-p ... 2018-10-05
"U.S. oil ends nearly flat, as Brent declines, but both benchmarks tally fourth weekly climb in a row"
By Myra P. Saefong and Mark DeCambre
Published: Oct 5, 2018 3:25 p.m. ET
U.S. oil prices ended nearly flat on Friday and global crude finished lower, as the market continued to question the ability of the world’s major producers to make up for losses of Iranian crude exports tied to pending U.S. sanctions.
Still, both crude benchmarks tallied a fourth weekly advance in a row.
Both had marked their highest settlements in nearly four years on Wednesday.
November West Texas Intermediate crude, the U.S. benchmark contract, tacked on a penny to settle at $74.34 a barrel on the New York Mercantile Exchange.
It settled at a nearly four-year high of $76.41 on Wednesday, but notched its biggest one-day percentage decline since mid-August on Thursday.
December Brent lost 42 cents, or 0.5%, to end at $84.16 a barrel on ICE Futures Europe.
For the week, based on front-month contracts, WTI rose 1.5%, while Brent crude advanced by 1.7%.
The Organization of the Petroleum Exporting Countries 15 members raised their crude-oil output in September to 33.07 million barrels a day—a 180,000-barrel-a-day rise from August, according to an S&P Global Platts survey of analysts, industry officials and shipping data released Friday.
The survey said “that is the most OPEC has pumped since July 2017, if the Republic of Congo, which joined the organization in June, is not included.”
The figures also show that OPEC and its 10 non-OPEC partners, led by Russia, “have surpassed their stated aim of raising production by a combined 1 million b/d from May levels.”
Herman Wang, senior writer, oil news at S&P Global Platts, pointed out to MarketWatch that OPEC, plus Russia, have surpassed the 1 million-barrel-a-day output rise, but “OPEC on its own is 850,000 [barrels a day] above its May level.”
OPEC had agreed in June to rein in member production cuts that began in January 2017.
“There are definitely dark storm clouds ahead for the market, with Iranian and Venezuelan production on a downward spiral,” said Wang.
“It appears OPEC and its allies are going to have to do more, to avoid the price spike that President [Donald] Trump is fretting, but there’s significant doubt about how much OPEC is willing and able to pump.”
Trump’s decision to pull out of a 2015 international agreement to curb Iran’s nuclear program, and a reimposition of economic sanctions on the third-largest producer of crude set to kick next month have been pivotal in driving crude futures to recent multiyear peaks.
Uncertainty remains over whether major oil producers, including members of OPEC and key non-OPEC members, like Russia, have the spare capacity to make up for the loss of Iranian exports.
“The two key uncertainties the oil market has to grapple with are first the spare capacity to replace Iranian barrels and, second, the unknown magnitude of these lost volumes due to a lack of clarity from the U.S. administration,” wrote Goldman Sachs commodity analysts, including Damien Courvalin and Jeffrey Currie, in a recent research note.
Goldman estimates a loss of 1.5 million barrels a day in the fourth quarter from the sanctions, but the analysts “acknowledge that the uncertainty on the size of the disruption will only start to be lifted after Nov. 4 when the sanctions go into effect.”
Meanwhile, monthly data on U.S. employment were mixed, providing little guidance for oil in terms of health of the economy and demand for crude.
The U.S. unemployment rate sank to 3.7% in September, while the economy added 134,000 new jobs—the smallest increase in 12 months.
Data from Baker Hughes on Friday showed that the number of active U.S. rigs drilling for oil, a key barometer of activity in the sector, fell by 2 to 861 this week.
That marked a third consecutive weekly decline.
Back on Nymex, petroleum-product futures ended lower, with November gasoline down 0.7% at $2.086 a gallon and November heating oil losing 0.3% at $2.392 a gallon.
Both finished higher for the week.
November natural gas shed 0.7% to $3.143 per million British thermal units, but saw a weekly rise of 4.5%.
https://www.marketwatch.com/story/oil-p ... 2018-10-05
Re: OIL, NATURAL GAS
MARKETWATCH
"Oil ends lower on talk U.S. waivers on Iran sanctions, but Hurricane Michael limits loss"
By William Watts and Myra P. Saefong
Published: Oct 8, 2018 3:31 p.m. ET
Oil futures ended lower Monday on reports that the Trump administration was softening its hard line on Iran crude exports and might allow waivers for some buyers when sanctions against the Islamic Republic’s crude exports go back into effect in November.
Hurricane-related disruptions to energy production in the Gulf of Mexico, however, limited oil’s price decline.
A reported explosion at a key oil refinery in Canada also contributed to a rise in gasoline futures.
U.S. benchmark West Texas Intermediate crude for November delivery on the New York Mercantile Exchange fell by a nickel, or less than 0.1%, to settle at$74.29 a barrel, paring earlier losses that had pulled prices to a low of $73.07.
Brent crude, the global benchmark, for December delivery LCOZ8, -0.50% fell 25 cents, or 0.3%, to $83.91 a barrel on ICE Futures Europe—also ending off the day’s low of $82.66.
Hurricane Michael was expected to move across the eastern Gulf on Tuesday and inland over Florida Wednesday, according to the U.S. National Hurricane Center.
Based on projections from the Energy Information Administration, however, the hurricane was expected to miss the bulk of energy production in the region.
Still, oil and natural-gas operators in the Gulf of Mexico have been taking precautions, evacuating a total of 10 production platforms, or about 1.5% of the 687 manned platforms in the region, the Bureau of Safety and Environmental Enforcement said Monday.
Roughly 19% of Gulf oil production and about 11% of natural-gas production have been shut in, the BSEE said.
Natural-gas futures also climbed Monday, extending their gains from last week to reach new multiweek highs as U.S. supplies remained below five-year averages.
Prices also got a boost from Hurricane Michael’s disruptions to Gulf gas output.
November natural-gas futures rose 12.4 cents, or 4%, to $3.267 per million British thermal units—again settling at their highest since January.
Oil prices had seen steeper losses early Monday.
A U.S. government official said the Trump administration was considering waivers on sanctions for countries that are reducing imports of Iranian oil, Reuters reported on Friday.
“The U.S. appears to be abandoning its tough stance on buyers of Iranian oil,” wrote analysts at Commerzbank.
“It appears that consumer countries are to be given more time after all to replace their oil shipments from Iran so long as they at least reduce them significantly.”
India is said to be one of the countries, the Commerzbank analysts noted, and reportedly has plans to buy 9 million barrels of crude from Iran in November, equivalent to 300,000 barrels a day after importing just shy of around 500,000 barrels a day in September.
If other consumers, including the European Union, Japan and South Korea are also allowed to continue buying Iranian crude, worries about tightening supply toward year-end could also be soothed, the analysts wrote.
Concerns about the hit to global supply from the reimposition of sanctions have been credited with the run-up in crude prices that took Brent above $86 a barrel to trade at a nearly four-year high last week, while WTI moved above $76.
Brent rose 1.7% last week, while WTI rallied 1.5%.
In other energy dealings, November gasoline futures fell 0.4% to $2.094 a gallon, while November heating oil added less than 0.1% to $2.394 a gallon.
News of an explosion at Irving Oil’s refinery in Saint John, New Brunswick, Canada, a key fuel supplier for the U.S. Northeast provided some modest support to gasoline futures Monday.
Irving Oil tweeted that a “major incident” occurred at the refinery early Monday.
News reports showed images of an explosion at the plant.
https://www.marketwatch.com/story/oil-p ... 2018-10-08
"Oil ends lower on talk U.S. waivers on Iran sanctions, but Hurricane Michael limits loss"
By William Watts and Myra P. Saefong
Published: Oct 8, 2018 3:31 p.m. ET
Oil futures ended lower Monday on reports that the Trump administration was softening its hard line on Iran crude exports and might allow waivers for some buyers when sanctions against the Islamic Republic’s crude exports go back into effect in November.
Hurricane-related disruptions to energy production in the Gulf of Mexico, however, limited oil’s price decline.
A reported explosion at a key oil refinery in Canada also contributed to a rise in gasoline futures.
U.S. benchmark West Texas Intermediate crude for November delivery on the New York Mercantile Exchange fell by a nickel, or less than 0.1%, to settle at$74.29 a barrel, paring earlier losses that had pulled prices to a low of $73.07.
Brent crude, the global benchmark, for December delivery LCOZ8, -0.50% fell 25 cents, or 0.3%, to $83.91 a barrel on ICE Futures Europe—also ending off the day’s low of $82.66.
Hurricane Michael was expected to move across the eastern Gulf on Tuesday and inland over Florida Wednesday, according to the U.S. National Hurricane Center.
Based on projections from the Energy Information Administration, however, the hurricane was expected to miss the bulk of energy production in the region.
Still, oil and natural-gas operators in the Gulf of Mexico have been taking precautions, evacuating a total of 10 production platforms, or about 1.5% of the 687 manned platforms in the region, the Bureau of Safety and Environmental Enforcement said Monday.
Roughly 19% of Gulf oil production and about 11% of natural-gas production have been shut in, the BSEE said.
Natural-gas futures also climbed Monday, extending their gains from last week to reach new multiweek highs as U.S. supplies remained below five-year averages.
Prices also got a boost from Hurricane Michael’s disruptions to Gulf gas output.
November natural-gas futures rose 12.4 cents, or 4%, to $3.267 per million British thermal units—again settling at their highest since January.
Oil prices had seen steeper losses early Monday.
A U.S. government official said the Trump administration was considering waivers on sanctions for countries that are reducing imports of Iranian oil, Reuters reported on Friday.
“The U.S. appears to be abandoning its tough stance on buyers of Iranian oil,” wrote analysts at Commerzbank.
“It appears that consumer countries are to be given more time after all to replace their oil shipments from Iran so long as they at least reduce them significantly.”
India is said to be one of the countries, the Commerzbank analysts noted, and reportedly has plans to buy 9 million barrels of crude from Iran in November, equivalent to 300,000 barrels a day after importing just shy of around 500,000 barrels a day in September.
If other consumers, including the European Union, Japan and South Korea are also allowed to continue buying Iranian crude, worries about tightening supply toward year-end could also be soothed, the analysts wrote.
Concerns about the hit to global supply from the reimposition of sanctions have been credited with the run-up in crude prices that took Brent above $86 a barrel to trade at a nearly four-year high last week, while WTI moved above $76.
Brent rose 1.7% last week, while WTI rallied 1.5%.
In other energy dealings, November gasoline futures fell 0.4% to $2.094 a gallon, while November heating oil added less than 0.1% to $2.394 a gallon.
News of an explosion at Irving Oil’s refinery in Saint John, New Brunswick, Canada, a key fuel supplier for the U.S. Northeast provided some modest support to gasoline futures Monday.
Irving Oil tweeted that a “major incident” occurred at the refinery early Monday.
News reports showed images of an explosion at the plant.
https://www.marketwatch.com/story/oil-p ... 2018-10-08
Re: OIL, NATURAL GAS
MARKETWATCH
"Oil prices are ‘entering the red zone,’ warns International Energy Agency chief"
By William Watts
Published: Oct 9, 2018 12:53 p.m. ET
Are you listening, OPEC?
‘We should all see the risky situation, the oil markets are entering the red zone.’
- Fatih Birol, International Energy Agency
That warning comes from Fatih Birol, executive director of the International Energy Agency, in an interview with Bloomberg.
He added that expensive energy “is back at a bad time, when the global economy is losing momentum."
"We really need more oil.”
Birol’s words are important because the IEA advises industrialized nations on energy policy and coordinates emergency oil releases globally.
On that point, Birol said the agency isn’t currently considering using its emergency reserves.
Brent crude, the global benchmark, was up 80 cents at $84.71 a barrel at midday Tuesday, while the U.S. benchmark, West Texas Intermediate crude rose 44 cents, or 0.6%, to $74.73 a barrel.
Both grades earlier this month traded at or near four-year highs.
The rally comes in part due to tightening global supplies ahead of the Trump administration’s reimposition of sanctions on Iran oil exports that take full effect in February, as well as hits to output by Venezuela and other producers.
Saudi Arabia and Russia have moved to boost output, but traders continue to debate their ability to offset lost barrels from Iran.
Higher prices also reflect a premium tied to the prospect of any unexpected interruptions.
Rising oil prices, which are beginning to push up gasoline prices, have also been a concern for President Donald Trump, who has blasted OPEC on Twitter and demanded it take action to lower prices.
Meanwhile, rising oil prices are seen putting pressure on emerging economies that are heavy energy consumers, contributing to worries about global growth prospects.
Birol told Bloomberg that lacking any “major moves” by key producers, the fourth quarter of this year looks “very, very challenging.”
Birol said that Saudi Arabia has the ability to boost production to 11 million barrels a day and that he is confident it will act responsibly.
https://www.marketwatch.com/story/oil-p ... 2018-10-09
"Oil prices are ‘entering the red zone,’ warns International Energy Agency chief"
By William Watts
Published: Oct 9, 2018 12:53 p.m. ET
Are you listening, OPEC?
‘We should all see the risky situation, the oil markets are entering the red zone.’
- Fatih Birol, International Energy Agency
That warning comes from Fatih Birol, executive director of the International Energy Agency, in an interview with Bloomberg.
He added that expensive energy “is back at a bad time, when the global economy is losing momentum."
"We really need more oil.”
Birol’s words are important because the IEA advises industrialized nations on energy policy and coordinates emergency oil releases globally.
On that point, Birol said the agency isn’t currently considering using its emergency reserves.
Brent crude, the global benchmark, was up 80 cents at $84.71 a barrel at midday Tuesday, while the U.S. benchmark, West Texas Intermediate crude rose 44 cents, or 0.6%, to $74.73 a barrel.
Both grades earlier this month traded at or near four-year highs.
The rally comes in part due to tightening global supplies ahead of the Trump administration’s reimposition of sanctions on Iran oil exports that take full effect in February, as well as hits to output by Venezuela and other producers.
Saudi Arabia and Russia have moved to boost output, but traders continue to debate their ability to offset lost barrels from Iran.
Higher prices also reflect a premium tied to the prospect of any unexpected interruptions.
Rising oil prices, which are beginning to push up gasoline prices, have also been a concern for President Donald Trump, who has blasted OPEC on Twitter and demanded it take action to lower prices.
Meanwhile, rising oil prices are seen putting pressure on emerging economies that are heavy energy consumers, contributing to worries about global growth prospects.
Birol told Bloomberg that lacking any “major moves” by key producers, the fourth quarter of this year looks “very, very challenging.”
Birol said that Saudi Arabia has the ability to boost production to 11 million barrels a day and that he is confident it will act responsibly.
https://www.marketwatch.com/story/oil-p ... 2018-10-09
Re: OIL, NATURAL GAS
MARKETWATCH
"Oil boosted by signs Iran crude exports falling, Hurricane Michael threat"
By William Watts and Myra P. Saefong
Published: Oct 9, 2018 3:23 p.m. ET
Oil futures settle higher Tuesday, finding support from signs that Iran crude exports are falling ahead of reimposed sanctions.
Market participants also eyed any risks to energy infrastructure as Hurricane Michael headed for the Gulf of Mexico.
West Texas Intermediate crude for November delivery on the New York Mercantile Exchange rose 67 cents, or 0.9%, to settle at $74.96 a barrel.
That was the highest finish since Wednesday.
The global benchmark, Brent crude for December delivery, gained $1.09, or 1.3%, to $85 a barrel on the ICE Europe exchange.
Iran exported only 1.1 million barrels a day of crude in the first week of October, Reuters reported, versus 1.6 million barrels a day in September and 2.5 million barrels a day in the spring.
Analysts at Commerzbank said signs of a perceptible decline in oil supply were allowing oil prices to overcome the weakness seen at the beginning of the week, which was prompted in part by indications the U.S. government might allow some crude importers waivers on Iranian crude.
The data indicate “U.S. sanctions are already having a visible impact even before officially coming into force in early November,” they said.
Meanwhile, Hurricane Michael was moving north-northwestward through the southern Gulf of Mexico.
Concerns about the storm helped limit losses for crude on Monday, analysts said, though Michael is expected to miss the bulk of energy production in the region.
On Tuesday, the Bureau of Safety and Environmental Enforcement reported that 39.5% of oil production and 28.4% of natural-gas production in the Gulf of Mexico has been shut in as the hurricane heads into the region.
Weekly data on U.S. petroleum supplies will be released a day late this week because of Monday’s Columbus Day holiday.
The American Petroleum Institute’s report is due out late Wednesday, while the Energy Information Administration’s data comes out Thursday at 11 a.m. Eastern time.
Analysts polled by S&P Global Platts expect the EIA report a climb of 1.61 million barrels in crude inventories for the week ended Oct. 5.
Gasoline stocks were forecast to rise by 422,000 barrels, but a 1.71 million-barrel decline was expected for distillate supplies, the survey said.
On Nymex, November gasoline settled at $2.077 a gallon, down 0.8%, and November heating oil rose 1.2% to $2.424 a gallon.
November natural gas ended nearly flat at $3.266 per million British thermal units.
It’s been fairly consistently marking its highest settlements since January.
Natural gas is up nearly 20% since mid-September, the Commerzbank analysts noted.
They attributed the rally in part to a below-average increase in U.S. natural gas stocks in the last three months.
“Currently they are 17% below the five-year average and at their lowest level for this time of year in 15 years."
"Because lower-than-normal temperatures are forecast over the next few days in the U.S., increased heating demand and only a small inventory build are likely,” they said, in a note.
“However, the record-high U.S. natural gas production should not allow any fears of a shortage to arise, even if stocks are at a comparatively low level at the start of the heating season."
"We therefore believe the further upside potential of the U.S. natural gas price to be limited.”
Weekly natural-gas storage figures from the Energy Information Administration were due on Thursday.
https://www.marketwatch.com/story/oil-b ... 2018-10-09
"Oil boosted by signs Iran crude exports falling, Hurricane Michael threat"
By William Watts and Myra P. Saefong
Published: Oct 9, 2018 3:23 p.m. ET
Oil futures settle higher Tuesday, finding support from signs that Iran crude exports are falling ahead of reimposed sanctions.
Market participants also eyed any risks to energy infrastructure as Hurricane Michael headed for the Gulf of Mexico.
West Texas Intermediate crude for November delivery on the New York Mercantile Exchange rose 67 cents, or 0.9%, to settle at $74.96 a barrel.
That was the highest finish since Wednesday.
The global benchmark, Brent crude for December delivery, gained $1.09, or 1.3%, to $85 a barrel on the ICE Europe exchange.
Iran exported only 1.1 million barrels a day of crude in the first week of October, Reuters reported, versus 1.6 million barrels a day in September and 2.5 million barrels a day in the spring.
Analysts at Commerzbank said signs of a perceptible decline in oil supply were allowing oil prices to overcome the weakness seen at the beginning of the week, which was prompted in part by indications the U.S. government might allow some crude importers waivers on Iranian crude.
The data indicate “U.S. sanctions are already having a visible impact even before officially coming into force in early November,” they said.
Meanwhile, Hurricane Michael was moving north-northwestward through the southern Gulf of Mexico.
Concerns about the storm helped limit losses for crude on Monday, analysts said, though Michael is expected to miss the bulk of energy production in the region.
On Tuesday, the Bureau of Safety and Environmental Enforcement reported that 39.5% of oil production and 28.4% of natural-gas production in the Gulf of Mexico has been shut in as the hurricane heads into the region.
Weekly data on U.S. petroleum supplies will be released a day late this week because of Monday’s Columbus Day holiday.
The American Petroleum Institute’s report is due out late Wednesday, while the Energy Information Administration’s data comes out Thursday at 11 a.m. Eastern time.
Analysts polled by S&P Global Platts expect the EIA report a climb of 1.61 million barrels in crude inventories for the week ended Oct. 5.
Gasoline stocks were forecast to rise by 422,000 barrels, but a 1.71 million-barrel decline was expected for distillate supplies, the survey said.
On Nymex, November gasoline settled at $2.077 a gallon, down 0.8%, and November heating oil rose 1.2% to $2.424 a gallon.
November natural gas ended nearly flat at $3.266 per million British thermal units.
It’s been fairly consistently marking its highest settlements since January.
Natural gas is up nearly 20% since mid-September, the Commerzbank analysts noted.
They attributed the rally in part to a below-average increase in U.S. natural gas stocks in the last three months.
“Currently they are 17% below the five-year average and at their lowest level for this time of year in 15 years."
"Because lower-than-normal temperatures are forecast over the next few days in the U.S., increased heating demand and only a small inventory build are likely,” they said, in a note.
“However, the record-high U.S. natural gas production should not allow any fears of a shortage to arise, even if stocks are at a comparatively low level at the start of the heating season."
"We therefore believe the further upside potential of the U.S. natural gas price to be limited.”
Weekly natural-gas storage figures from the Energy Information Administration were due on Thursday.
https://www.marketwatch.com/story/oil-b ... 2018-10-09
Re: OIL, NATURAL GAS
MARKETWATCH
"Fed’s Kaplan sees risk of higher oil prices ahead"
By Greg Robb
Published: Oct 9, 2018 11:33 a.m. ET
Dallas Fed President Robert Kaplan said Tuesday he sees a risk of higher oil prices in coming years as U.S. shale production may not be able to meet global demand.
“We think the price risk is more to upside and we may well be in global undersupply situation in the next three to five years, and so we need to be braced for that,” Kaplan said, during a talk to the Economics Club of New York.
At the moment, there is “a fragile equilibrium” where supply and demand is relatively balanced, but shale may not be able to replace oil lost from Venezuela and Iran.
“We may get through this equilibrium period without a spike but if you have a geopolitical event where more barrels come off [the market] than expected, there not much space capacity in the world based on our analysis, and so we’re watching it carefully,” Kaplan said.
The Dallas Fed president said shale from the Permian basin is going to grow dramatically but “it remains uncertain whether it will grow fast enough to keep up with global demand.”
There are “people shortages, infrastructure shortages and pipeline shortages” holding back shale production and industry officials say that trade tariffs may have slowed things down further, Kaplan said.
“People who are in shale business tell me they’re skeptical how fast shale can grow,” he said.
https://www.marketwatch.com/story/feds- ... 2018-10-09
"Fed’s Kaplan sees risk of higher oil prices ahead"
By Greg Robb
Published: Oct 9, 2018 11:33 a.m. ET
Dallas Fed President Robert Kaplan said Tuesday he sees a risk of higher oil prices in coming years as U.S. shale production may not be able to meet global demand.
“We think the price risk is more to upside and we may well be in global undersupply situation in the next three to five years, and so we need to be braced for that,” Kaplan said, during a talk to the Economics Club of New York.
At the moment, there is “a fragile equilibrium” where supply and demand is relatively balanced, but shale may not be able to replace oil lost from Venezuela and Iran.
“We may get through this equilibrium period without a spike but if you have a geopolitical event where more barrels come off [the market] than expected, there not much space capacity in the world based on our analysis, and so we’re watching it carefully,” Kaplan said.
The Dallas Fed president said shale from the Permian basin is going to grow dramatically but “it remains uncertain whether it will grow fast enough to keep up with global demand.”
There are “people shortages, infrastructure shortages and pipeline shortages” holding back shale production and industry officials say that trade tariffs may have slowed things down further, Kaplan said.
“People who are in shale business tell me they’re skeptical how fast shale can grow,” he said.
https://www.marketwatch.com/story/feds- ... 2018-10-09