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Oil gains for 3rd day, natural gas plunges
Source: Agencies |
April 23, 2013, Tuesday
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OIL rose for a third straight day yesterday as relatively low oil prices rekindled interest among buyers.
Benchmark oil for May gained 75 cents to finish at US$88.76 a barrel on the New York Mercantile Exchange.
Traders have cautiously returned to buying certain key commodities, including gold and oil, after a big sell-off early last week. Gold rose nearly US$26 an ounce yesterday.
Brent crude, which is used to price oil used by many US refiners, rose 74 cents to US$100.39 on the ICE Futures exchange in London.
Over the past three weeks, the price of oil has fallen by 9 percent to US$88 a barrel, being driven lower by rising global supplies and lower-than-expected demand in the world's two largest economies, the United States and China.
Also, oil production is growing quickly in the US and Canada, helping boost global supplies. And some of the factors that pushed prices higher the two previous years - political turmoil in North Africa and the Middle East and refinery disruptions in the US - haven't materialized this spring.
At the same time, demand for fuels is growing slower than expected. China, the world's biggest oil importer, is experiencing slower-than-expected economic growth. And much of Europe is in recession.
However, political turmoil or refinery problems could crop up at any time. Analysts are particularly worried about the transition of power in Venezuela, a major oil exporter, after the death of President Hugo Chavez. Violence has erupted in the wake of a closely contested election, and the financial situation of the country is precarious. Analysts worry that the country's oil production could slip.
Natural gas fell 14 cents to US$4.27 per 1,000 cubic feet. Jim Ritterbusch, president of energy consultancy Ritterbusch and Associates, said the drop was caused by forecasts for above normal temperatures starting by the end of this week.
In other energy futures trading on the Nymex:
- Gasoline was flat at US$2.77 per gallon.
- Heating oil added 2 cents to US$2.81 a gallon.
Benchmark oil for May gained 75 cents to finish at US$88.76 a barrel on the New York Mercantile Exchange.
Traders have cautiously returned to buying certain key commodities, including gold and oil, after a big sell-off early last week. Gold rose nearly US$26 an ounce yesterday.
Brent crude, which is used to price oil used by many US refiners, rose 74 cents to US$100.39 on the ICE Futures exchange in London.
Over the past three weeks, the price of oil has fallen by 9 percent to US$88 a barrel, being driven lower by rising global supplies and lower-than-expected demand in the world's two largest economies, the United States and China.
Also, oil production is growing quickly in the US and Canada, helping boost global supplies. And some of the factors that pushed prices higher the two previous years - political turmoil in North Africa and the Middle East and refinery disruptions in the US - haven't materialized this spring.
At the same time, demand for fuels is growing slower than expected. China, the world's biggest oil importer, is experiencing slower-than-expected economic growth. And much of Europe is in recession.
However, political turmoil or refinery problems could crop up at any time. Analysts are particularly worried about the transition of power in Venezuela, a major oil exporter, after the death of President Hugo Chavez. Violence has erupted in the wake of a closely contested election, and the financial situation of the country is precarious. Analysts worry that the country's oil production could slip.
Natural gas fell 14 cents to US$4.27 per 1,000 cubic feet. Jim Ritterbusch, president of energy consultancy Ritterbusch and Associates, said the drop was caused by forecasts for above normal temperatures starting by the end of this week.
In other energy futures trading on the Nymex:
- Gasoline was flat at US$2.77 per gallon.
- Heating oil added 2 cents to US$2.81 a gallon.
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