MARKET WATCH: NYMEX oil price falls on strengthening dollar

Light, sweet crude oil prices for December delivery fell to settle under $45/bbl on the New York market Oct. 23 on news of a strengthening dollar, which was boosted after China said it would cut interest rates by a quarter of a percentage point as part of the Asian nation’s ongoing attempts to help its economy.

Oil trades in dollars so a stronger dollar makes oil more expensive for buyers using other currency.

US natural gas prices also fell on both the futures and Henry Hub spot markets. In a research note, Barclays analyst Michael Cohen of New York said forecasts indicate a 95% chance that El Nino will continue through the Northern Hemisphere’s 2015-16 winter season.

“There is no good way to quantify the expected impact,” regarding an El Nino, Cohen said. “Should it resemble the last three episodes or exceed the strongest on record from 1997-98, the warmer-than-normal Northeast weather would erase an upside distillate demand swing amounting to around 80,000 b/d by our calculations.”

He also noted that El Ninos have differed in past decades as far as US winter weather and the consequences upon oil and gas markets, particularly oil demand for power.

“A strong El Nino might have more of an impact on natural gas,” this winter, he said.

Energy prices

The December crude oil contract on the New York Mercantile Exchange dropped 78¢ on Oct. 23 to $44.60/bbl. The January crude oil contract declined 65¢ to $45.47/bbl.

The natural gas contract for November dropped 10¢ to a rounded $2.29/MMbtu. The Henry Hub, La., gas price was $2.27/MMbtu, down 7¢.

Heating oil for November delivery decreased 1¢ to a rounded $1.45/gal. The price for reformulated gasoline stock for oxygenates blending for November dropped by a fraction of a penny to a rounded $1.30/gal.

The December ICE contract for Brent crude was down 9¢ to $47.99/bbl. The January contract decreased 16¢ to $48.67/bbl. ICE gas oil for November settled at $437.70/tonne, down $6.05.

The average price for the OPEC basket of 12 benchmark crudes for Oct. 23 was unavailable because the OPEC Secretariat office was closed Oct. 26.

Contact Paula Dittrick at

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

Did You Like this Article? Get All the Energy Industry News Delivered to Your Inbox

Subscribe to an email newsletter today at no cost and receive the latest news and information.

 Subscribe Now


The Time is Right for Optimum Reliability: Capital-Intensive Industries and Asset Performance Management

Imagine a plant that is no longer at risk of a random shutdown. Imagine not worrying about losing...

Going Digital: The New Normal in Oil & Gas

In this whitepaper you will learn how Keystone Engineering, ONGC, and Saipem are using software t...

Maximizing Operational Excellence

In a recent survey conducted by PennEnergy Research, 70% of surveyed energy industry professional...

Leveraging the Power of Information in the Energy Industry

Information Governance is about more than compliance. It’s about using your information to drive ...