MARKET WATCH: NYMEX crude oil, gas prices climb

Crude oil prices climbed more than $1/bbl on the New York market on a lower-than-expected increase in US oil and product supplies Apr. 29 while US natural gas futures prices rose for a second consecutive session.

The gas-price rally came the same week that the New York Mercantile Exchange gas contract for June delivery closed at its lowest settlement since June 15, 2002. The Apr. 27 settlement was $2.49/MMbtu.

The US Energy Information Administration estimated the oil inventory, excluding the Strategic Petroleum Reserve, at 490.1 million bbl, up 1.9 million bbl, for the week ended Apr. 24 (OGJ Online, Apr. 29, 2015).

Barclays Research analysts said supply-and-demand fundaments remain weak although other analysts said the inventory numbers suggest a slowing in the pace of US shale production.

“The oil market has likely passed through the worst period, but it is not out of the woods yet,” Michael Cohen at Barclays said.

Paul Horsnell, head of commodities research at Standard Chartered, said the falling onshore rig count, particularly in shale plays, will mean slowing oil production yet this year.

“In our view, there is no doubt that US output is falling, and that the pace of decline is likely to accelerate in coming months," Horsnell said.

Regarding gas in underground storage across the Lower 48, EIA estimated working gas in storage at 1.71 tcf as of Apr. 24, a net increase of 81 bcf from the previous week.

Stocks were 741 bcf higher than last year at this time and 75 bcf below the 5-year average of 1.78 tcf, the weekly Gas Storage Report said.

Energy prices

The New York Mercantile Exchange June crude oil contract rose $1.52 on Apr. 29 to $58.58/bbl. The July contract climbed $1.33 to $59.86/bbl.

The natural gas contract for June rose nearly 7¢ to $2.60/MMbtu. The Henry Hub, La., gas price was $2.56/MMbtu, up 3¢.

Heating oil for May was up 3¢ to a rounded $1.95/gal. The price for reformulated gasoline stock for oxygenates blending for May climbed about 2¢ to a rounded $2.02/gal.

The June ICE contract for Brent crude rose $1.20 to $65.84/bbl, while the July contract climbed $1.19 to $66.54/bbl. The ICE gas oil contract for May gained $7.25 to $593.75/tonne.

The average price for the OPEC’s basket of 12 benchmark crudes was $60.92/bbl on Apr. 29, up 51¢.

Contact Paula Dittrick at paulad@ogjonline.com.

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

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