Sam Fletcher
Senior Writer
HOUSTON, Feb. 19 -- Energy futures prices were mixed Wednesday ahead of government and industry reports on US inventories of crude, petroleum products, and natural gas.
The March contract for benchmark US light, sweet crudes gained 26¢ to $35.45/bbl Wednesday on the New York Mercantile Exchange, while the April position retreated by 38¢ to $34.48/bbl. On the US spot market, West Texas Intermediate at Cushing, Okla., increased by 27¢ to $35.45/bbl.
Analysts credited the gains in crude prices to remarks by Venezuela Energy and Mines Minister Rafael Ramirez that the Organization of Petroleum Exporting Countries may again decide to cut production if crude prices decline from current levels.
The average price for OPEC's basket of seven benchmark crudes increased by 44¢ to $30.52/bbl Wednesday.
Heating oil for March deliver lost 0.69¢ to 93.34¢/gal Wednesday on NYMEX. Gasoline for the same month slipped by 0.18¢ to $1.0498/gal.
However, the March natural gas contract edged up by 3.7¢ to $5.36/Mcf on NYMEX, "helped by firmer crude oil [prices] and some technical buying and short covering [purchases to cover outstanding sales contracts] after Tuesday's steep slide, despite a weaker cash [spot] market and milder weather this week," said analysts Thursday at Enerfax Daily.
"The back months [later gas contract prices] have been holding up, causing hesitancy to sell the front," they explained. "The weather is pretty mild this week, but the forecasts turn cooler again next week."
US energy inventories
The US Energy Information Administration reported early Thursday that 172 bcf of natural gas were withdrawn from underground storage during the week ended Feb. 13. That was down from withdrawals of 224 bcf the previous week and 203 bcf during the same period last year and below the projected consensus of Wall Street analysts. US gas storage now totals a little more than 1.4 tcf, up by 263 bcf from year-ago levels but 95 bcf below the 5-year average.
EIA also reported commercial US crude inventories jumped by 4.9 million bbl to 273.8 million bbl during the week ended Feb. 13, due largely to a big increase in imports. Nevertheless, US crude inventories are still 26.6 million bbl below the 5-year average for this time of year, officials said.
US gasoline stocks increased by 600,000 bbl last week to 205 million bbl but are 9 million bbl below the 5-year average. Distillate fuel inventories fell by 5.8 million bbl to 112.5 million bbl during the same period. Distillate stocks have dropped a total of 25.8 million bbl since Jan. 9 and are now 8.6 million bbl below the 5-year average, EIA reported.
US crude imports continued their recent seesaw pattern, increasing by 1.7 million b/d to average nearly 10.2 million b/d last week. Most of the increased imports were in the US Gulf Coast region, officials said.
Crude input into US refineries increased by 126,000 b/d to nearly 15 million b/d. "Most of the increase last week was on the East Coast and the Midwest, while in the Gulf Coast refinery inputs averaged below 7 million b/d for the third consecutive week," EIA said.
API summary
Meanwhile, the American Petroleum Institute reported Thursday that US petroleum imports jumped by nearly 11% in January from year-ago levels, marketing the first time since October that monthly imports exceeded 12 million b/d.
Crude imports into the US rose by 12.5% to more than 9.6 million b/d during that period—a new high for January but not as high as imports of more than 10 million b/d during July-October 2003, said API officials. Imports of petroleum products increased by 5.1% to almost 2.6 million b/d, they said.
Imports of gasoline and gasoline blending components last month declined by some 23% from record levels in January 2003, while distillate imports increased to nearly 400,000 b/d, the highest level for January in 3 years, API reported. Imports of residual oil also were strong, increasing by more than 80,000 b/d to more than 360,000 b/d in January.
Total deliveries of petroleum products fell slightly short of year-ago levels in January as they had in December. API officials blamed winter storms, higher retail prices, and stifled demand for gasoline. Distillate deliveries slipped despite colder winter weather in the Northeast US compared with a year ago.
However, jet fuel deliveries rose more than 5% against "particularly week deliveries" a year ago, said API, while residual oil deliveries jumped by more than 20% as natural gas remained expensive or unavailable for electric utilities and industrial users with the capability to switch from gas to oil.
Utilization exceeded 90% of operable US refining capacity during January, a period when refinery activity often slows as the end of the heating season nears. Production of gasoline and jet fuel increased by 1% each during the month, while output of distillate fuel oil jumped by nearly 7%, API reported.
Commercial US oil inventories averaged 267 million bbl during most of January. "Even with a temporary jump in the last week of the month, crude oil inventories remained on the lower end of recent historical experience. Refineries, however, continued to run without any major supply-related incidents reported," API said.
"Historically, January has often been a month for builds in gasoline inventories, but this January inventories slipped about 1 million bbl. They ended the month about 11 million bbl below the recent-year range," it said.
US crude production slipped by 1.7% in January from year-ago levels, despite 1.9% increased production of Alaskan crude, which surpassed 1 million b/d for the first time since June, said API. However, Alaska's increased production was more than offset by a 2.4% decline in the Lower 48.
Other energy prices
In London, the April contract for North Sea Brent gained 30¢ to $30.99/bbl Wednesday on the International Petroleum Exchange. Gas oil for March delivery was unchanged at $261.25/tonne. The March natural gas contract was unchanged at the equivalent of $4.19/Mcf on IPE.
Contact Sam Fletcher at [email protected]
