Light, sweet crude oil prices for January settled under $37/bbl on the New York market Dec. 10 while Brent crude oil prices settled under $40/bbl on the London market, which analysts attributed to high production from the Organization of Petroleum Exporting Countries.
It was the first time that US light, sweet crude settled under $37/bbl since 2009, which analysts attributed to market reaction after OPEC statistics indicated the cartel increased its November crude oil production to the highest monthly level in 3 years.
OPEC issued a monthly Oil Market Report showing its total production rose by 230,100 b/d in November from October. The November output was 31.695 million b/d. The increase stemmed from higher production from Iraq.
An OPEC official told the Wall Street Journal that the last time OPEC pumped more crude oil was in April 2012 when production was 31.7 million b/d.
The report said Iraq’s production rose by an estimated 247,000 b/d to 4.307 million b/d during November, the OPEC report said.
The NYMEX natural gas contract for January hits lows last seen in April 2012, falling 4.7¢ to a rounded $2.01/MMbtu. The Henry Hub gas price was $1.91/MMbtu on Dec. 10, down 9¢.
“You need winter,” Donald Morton, Herbert J. Sims & Co. senior vice-president, told WSJ. “The natural gas spike of supply is way outpacing demand.”
Heating oil for January delivery dropped by a rounded 1.4¢ to a rounded $1.23/gal. The price for reformulated gasoline stock for oxygenates blending for January was up 4.8¢ to a rounded $1.28/gal.
The January ICE contract for Brent crude dropped 38¢ to $39.73/bbl, and the February contract was down 21¢ to $40.13/bbl. The ICE gas oil contract for January was $365/tonne on Dec. 10, down $8.
The average price for OPEC’s basket of 12 benchmark crudes for Dec. 10 was $34.69/bbl, down 11¢.
Contact Paula Dittrick at email@example.com.
*Paula Dittrick is editor of OGJ’s Unconventional Oil & Gas Report.