Light, sweet crude oil prices for April delivery gained slightly on the New York market Mar. 17 to remain under $49/bbl while oil prices dropped in early Mar. 20 trading following a higher weekly rig count total.
The US drilling rig count jumped 21 units to 789 for the week ended Mar. 17, said Baker Hughes Inc. The rig count has risen in 9 consecutive weeks (OGJ Online, Mar. 17, 2017).
Analysts and traders watch the rig count for a sign of future US oil production. Meanwhile, the Organization of Petroleum Exporting Countries and other major producer are cutting production to support oil prices.
Bjarne Schieldrop, chief commodities analyst at SEB Markets, told the Wall Street Journal that SEB Markets forecasts US oil production at 10.7 million b/d in 2018. The US Energy Information Administration revised its production forecast up to 9.2 million b/d in 2017 and 9.7 million b/d in 2018.
Last week, oil prices snapped a losing streak on Mar. 15 because the dollar’s value dropped when the Federal Reserve announced a decision to raise interest rates as expected. Oil is traded in dollars so a weaker dollar makes oil less expensive for buyers using other currencies.
The crude oil contract for April delivery on the New York Mercantile Exchange gained 3¢ on Mar. 17 to $48.78/bbl. The May contract climbed by 7¢ to $49.31/bbl.
The natural gas price for April rose 4.6¢ to a rounded $2.95/MMbtu. The Henry Hub cash gas price closed at $2.82/MMbtu, down 3¢.
Heating oil for April rose by less than 1¢ to a rounded $1.51/gal. Reformulated gasoline stock for oxygenate blending for April also gained nearly a penny to a rounded $1.60/gal.
The Brent crude contract for May on London’s ICE increased 2¢ to $51.76/bbl. The June contract gained 5¢ to $51.95/bbl. The gas oil contract settled at $456.75/tonne on Mar. 17, down $1.75.
The average price for OPEC’s basket of benchmark crudes on Mar. 17 was $49.36/bbl, down 34¢.
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