Related News
Oil prices slide to settle under US$74
Source: Agencies |
January 28, 2010, Thursday
|
Online Edition
Online Edition
OIL prices continued their two-week slide yesterday after a government report showed demand for crude products dropped even further from the weak levels of a year ago when the recession's grip on the economy was strongest.
Benchmark crude for March delivery fell US$1.04 to settle at US$73.67 a barrel on the New York Mercantile Exchange. That's the lowest settlement price since Dec. 14, when crude dipped to US$73.46.
Wholesale prices for natural gas, heating oil and gasoline also tumbled.
Oil prices initially moved slightly higher after the Energy Information Administration reported a big decline in crude inventories last week. But once traders realized that foggy weather and high seas in the Gulf of Mexico, as well as an accident at a southeast Texas port, probably slowed deliveries and accounted for the drop, the focus turned to the lack of demand.
The EIA report showed demand for gasoline fell 0.8 percent over the four weeks ended Friday compared with a year ago and that demand for distillates used for heating oil and diesel fuel is off 8.1 percent.
"People were expecting a better number with the recovery," said Michael Lynch of Strategic Energy and Economic Research.
Even though the economy has pulled out of recession, unemployment remains stubbornly high at levels last seen more than a generation ago. Industrial production is still weak. That has undercut demand for of all kinds of energy - from natural gas to run factories and power plants to gasoline for weekend trips and vacations.
Analyst and trader Stephen Schork said it's hard to imagine demand being lower than a year ago. "That is when we were in the abyss," he said.
Schork wondered whether the move to more fuel-efficient vehicles could also be part of the reason for lower demand.
Oil prices are about double what they were a year ago and hit a 15-month high earlier this month even though consumption has been awful. Valero, the biggest U.S. refiner, reported yesterday that it lost almost US$2 billion in 2009 as it struggled to pass on higher oil prices to consumers.
Weak has pushed Valero and other refiners to shut some operations.
"Both refinery utilization and crude oil imports are at figures only seen previously after hurricanes, going back over the last two decades or more," Peter Beutel of Cameron Hanover said in a report yesterday.
In other Nymex trading in February contracts, heating oil fell 3.4 cents to settle at US$1.9168 a gallon, while gasoline dropped 2.82 cents to settle at US$1.9392 a gallon. Natural gas futures slid by 21.1 cents to settle at US$5.274 per 1,000 cubic feet.
Benchmark crude for March delivery fell US$1.04 to settle at US$73.67 a barrel on the New York Mercantile Exchange. That's the lowest settlement price since Dec. 14, when crude dipped to US$73.46.
Wholesale prices for natural gas, heating oil and gasoline also tumbled.
Oil prices initially moved slightly higher after the Energy Information Administration reported a big decline in crude inventories last week. But once traders realized that foggy weather and high seas in the Gulf of Mexico, as well as an accident at a southeast Texas port, probably slowed deliveries and accounted for the drop, the focus turned to the lack of demand.
The EIA report showed demand for gasoline fell 0.8 percent over the four weeks ended Friday compared with a year ago and that demand for distillates used for heating oil and diesel fuel is off 8.1 percent.
"People were expecting a better number with the recovery," said Michael Lynch of Strategic Energy and Economic Research.
Even though the economy has pulled out of recession, unemployment remains stubbornly high at levels last seen more than a generation ago. Industrial production is still weak. That has undercut demand for of all kinds of energy - from natural gas to run factories and power plants to gasoline for weekend trips and vacations.
Analyst and trader Stephen Schork said it's hard to imagine demand being lower than a year ago. "That is when we were in the abyss," he said.
Schork wondered whether the move to more fuel-efficient vehicles could also be part of the reason for lower demand.
Oil prices are about double what they were a year ago and hit a 15-month high earlier this month even though consumption has been awful. Valero, the biggest U.S. refiner, reported yesterday that it lost almost US$2 billion in 2009 as it struggled to pass on higher oil prices to consumers.
Weak has pushed Valero and other refiners to shut some operations.
"Both refinery utilization and crude oil imports are at figures only seen previously after hurricanes, going back over the last two decades or more," Peter Beutel of Cameron Hanover said in a report yesterday.
In other Nymex trading in February contracts, heating oil fell 3.4 cents to settle at US$1.9168 a gallon, while gasoline dropped 2.82 cents to settle at US$1.9392 a gallon. Natural gas futures slid by 21.1 cents to settle at US$5.274 per 1,000 cubic feet.
- About Us
- |
- Terms of Use
- |
-
RSS - |
- Privacy Policy
- |
- Contact Us
- |
- Shanghai Call Center: 962288
- |
- Tip-off hotline: 52920043
- 沪ICP证：沪ICP备05050403号-1
- |
- 互联网新闻信息服务许可证：31120180004
- |
- 网络视听许可证：0909346
- |
- 广播电视节目制作许可证：沪字第354号
- |
- 增值电信业务经营许可证：沪B2-20120012
Copyright © 1999- Shanghai Daily. All rights reserved.Preferably viewed with Internet Explorer 8 or newer browsers.
