MARKET WATCH: Crude oil prices whipsaw following attack in Paris
Crude oil prices on the New York market fell by more than $1/bbl on Nov. 13 although oil futures were on the rebound in early Nov. 16 trading upon concerns about possible supply disruptions after France launched airstrikes in Syria following terror attacks in Paris.
The French government on Nov. 15 started airstrikes against Islamic State’s stronghold in Syria a day after French President François Hollande vowed a “merciless” response to the attacks on Paris.
Meanwhile, Bloomberg reports that November crude US imports from Iraq will be the highest in over 3 years. Iraq loaded as many as 10 tankers in the past several weeks to deliver crude to US ports during November, Bloomberg reported last week citing ship-tracking and charters information.
If the tankers arrive as scheduled, Bloomberg’s estimated 19 million bbl total would mark the biggest monthly influx from Iraq since June 2012, according to Energy Information Administration statistics.
“In the longer term, we expect the US to have to increase imports next year by some 500,000-800,000 b/d year-on-year,” said Steve Sawyer, the head of refining at FGE, a consultant in London. “Given our projections for Iraqi output, it could well come from here.”
Meanwhile, US oil production has been on the decline in recent months given low commodity prices.
The US drilling rig count dropped 4 units to 767 rigs for the week ended Nov. 13, marking the 11th time in 12 weeks it has fallen and remaining its lowest since Apr. 26, 2002, according to data from Baker Hughes Inc. (OGJ Online, Nov. 13, 2015).
However, the US oil-directed count posted its first increase, a modest gain, in 11 weeks. Adding 2 units for the week ended Nov. 13 to reach 574, the oil-directed total was still down 101 units since Aug. 28 and 1,578 units year-over-year.
The December crude oil contract on the New York Mercantile Exchange fell $1.01 on Nov. 13 to $40.74/bbl. The January crude oil contract fell $1.03 to $42/bbl.
The NYMEX natural gas contract for December gained 10¢ to a rounded $2.36/MMbtu. The Henry Hub gas price was unchanged at $2.01/MMbtu.
Heating oil for December delivery lost 2.5¢ to a rounded $1.38/gal. The price for reformulated gasoline stock for oxygenates blending for December dropped 3.4¢ to a rounded $1.24/gal.
The December ICE contract for Brent crude declined 45¢ to $43.61/bbl. The January contract declined 72¢ to $44.47/bbl. The ICE gas oil contract for December closed at $426.25/tonne, down $5.
The average price for the OPEC basket of 12 benchmark crudes for Nov. 13 was $39.21/bbl, down $1.
Contact Paula Dittrick at firstname.lastname@example.org.
Paula Dittrick is editor of OGJ’s Unconventional Oil & Gas Report.