MARKET WATCH: NYMEX oil prices hovering around $76/bbl

Crude oil futures prices moved narrowly in Nov. 24 trading on both New York and London markets ahead of a Nov. 27 Organization of Petroleum Exporting Countries meeting in Vienna.

Barclays Research Inc. analysts suggested that OPEC has reduced leverage over the world oil market, and that the cartel is apt to be cautious when it comes to trimming production quotas.

Although oil prices have fallen in recent months, a quota reduction by OPEC “may not be enough to support prices and could simply result in lost market share and revenue,” said Miswin Mahesh of Barclays in London.

Mahesh noted that Saudi Arabia, OPEC’s biggest producer, is less able to influence oil prices than at any time over the past decade.

Morgan Stanley analysts said the market cannot ignore non-OPEC production.

“Non-OPEC producers could help rebalance oil markets. Russia’s foreign minister announced last week that Russia is willing to cooperate with Saudi Arabia on issues related to energy and oil markets,” Morgan Stanley told the Wall Street Journal.

Elsewhere, negotiations about Iran’s nuclear program were extended to June 2015. A Nov. 24 deadline by Iran and US officials failed to result in any agreement so negotiations will reconvene in December.

Energy prices

The New York Mercantile Exchange January crude oil contract declined 73¢ on Nov. 24, closing at $75.58/bbl. The February 2015 contract fell 72¢ to $75.87/bbl.

The natural gas contract for December dropped 11.5¢ to a rounded $4.15/MMbtu. The cash gas price at Henry Hub, La., was $4.07/MMbtu, down 20¢.

Heating oil for December delivery was down nearly a penny to a rounded $2.40/gal. Reformulated gasoline stock for oxygenate blending for December delivery dropped 2.3¢ to a rounded $2.03/gal.

The January 2015 ICE contract for Brent crude oil dropped 68¢ to $79.68/bbl. The February 2015 contract fell 70¢ to $80.15/bbl. The ICE gas oil contract for December rose $2.50, settling at $706.75/tonne.

The average price for OPEC’s basket of 12 benchmark crudes on Nov. 24 was $75.70/bbl, up 28¢.

Contact Paula Dittrick at paulad@ogjonline.com.

*Paula Dittrick is editor of OGJ’s Unconventional Oil & Gas Report.

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