The price for light, sweet crude oil for March delivery dropped more than $1 on the New York market Feb. 11 to settle at $26.21/bbl, the lowest settlement since May 6, 2003. But oil prices appeared to be climbing in early trading on Feb. 12 after news reports of comments about possible production cuts.
Late on Feb. 11, UAE Energy Minister Suhail bin Mohammed al-Mazrouei reportedly said the Organization of Petroleum Exporting Countries is open for a discussion on possible reductions in output.
Meanwhile, Venezuela proposed that OPEC and non-OPEC producers could freeze production at current levels. Many traders and analysts remained skeptical that any such agreement could be reached.
“An OPEC cut is still hard to see, but this week the notion of an OPEC freeze was introduced, and we find that easier to envisage,” said Olivier Jakob of Petromatrix.
Jakob said the proposed OPEC production freeze would not immediately reduce oil supplies to world markets but that any sign of OPEC supply management could provide sentimental support.
The NYMEX natural gas contract for March dropped 52¢ to a rounded $1.99/MMbtu. The Henry Hub gas price was down 1¢ to $2.12/MMbtu on Feb. 11.
Heating oil for March delivery edged up less than a penny to remain at a rounded 98¢/gal. The price for reformulated gasoline stock for oxygenates blending for March also held steady at a rounded 94¢/gal on Feb. 11.
The April ICE contract for Brent crude dropped 78¢ to $30.06/bbl on Feb. 11, and the May contract declined 72¢ to settle at $30.78/bbl. The ICE gas oil contract for March was $285.50/tonne, up 25¢.
The average price for OPEC’s basket of 12 benchmark crudes was $25.21/bbl, down 72¢.
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