WTI futures were higher during midday trade in Europe today, while Brent dropped as Iraq was seen safe and Libya looked set to restart two main oil-exporting terminals. Meanwhile, natural gas futures continued sliding ahead of comfortably cool days for parts of the US.
West Texas Intermediate futures for settlement in August traded for $103.77 per barrel at 14:01 GMT on the New York Mercantile Exchange, up 0.23%. Prices ranged from $104.20 to $103.27 per barrel. The US contract dropped 0.51% on Monday, after losing about 1.9% last week.
Meanwhile on the ICE in London, Brent futures due in August stood for a 0.46% drop at $109.73 per barrel. Daily high and low stood at $110.16 and $109.49 per barrel, respectively. Brent’s premium to WTI stood at $5.96, after last session’s closing margin of $6.71. The European contract dropped about 0.36% yesterday, after a 2.3% loss for last week.
“With geopolitical events subsiding, the market will turn to what the global economy is doing,” Jonathan Barratt, chief investment officer at Ayers Alliance Securities in Sydney, said for Bloomberg. “Libya is coming back online and it appears things have slowed in Iraq. Given where we are, a soft picture prevails.”
The private American Petroleum Institute (API) will post its weekly readings on US oil inventories for the seven days ended July 4 later today. A Bloomberg survey suggests a 2.7 million-barrel draw for crude, while gasoline stocks are projected to have dropped 450 000 barrels.
The official EIA report is due on Wednesday.
Two oil-exporting ports in eastern Libya have been reopened after being closed for almost a year due to insurgency. The Es Sider and Ras Lanuf facilities are Libya’s biggest and third-biggest ports, and have a combined potential exporting capabilities of more than 0.5 million barrels per day.
The rebels who had occupied the ports have handed them over to the newly elected government as a sign of support.
Now the government has instructed the National Oil Company to start marketing supplies from the two terminals, Mohamed Elharari, spokesman for the state-run company, said for Bloomberg.
Front month natural gas futures, due in August, dropped 1.09% at the New York Mercantile Exchange to trade for $4.179 per million British thermal units at 14:02 GMT today. Prices ranged from a six-month low of $4.164 to $4.234 per mBtu. The contract lost 4.1% on Monday, after dropping about 0.9% last week.
“Without calls for sustained heat across the major gas-consuming regions of the country, we continue to come under pressure,” Gene McGillian, analyst and broker at Tradition Energy in Stamford, Connecticut, said for Bloomberg. “Gas coming out of the ground is slowly eating away the fear that we won’t have enough gas for next winter heating season.”
The Energy Information Administration’s weekly natural gas storage report revealed a 100-billion cubic feet gain in nationwide US inventories in the seven days through June 27th, well above the average gain, but in line with expectations. NatGasWeather.com had predicted a gain between 99 and 103 billion cubic feet, while the five-year average build for the respective period was 78 bcf, and for this week the analysts at the site suggest a gain closer to 90 Bcf.
NatGasWeather.com reported on Monday that the southern and western US will remain very hot for the next seven days, with regular temperature peaks into triple digits. Meanwhile, the Midwest and Northeast will be subject to a cooler Canadian system tracking south, which will drag temperatures down midweek. However, soon after the system passes readings will climb into the 90s again. Cooling demand is expected to remain moderate-to-high this week.
In the 8-14 day outlook, NatGasWeather.com projected a colder trend for the US. Strong high pressure is set to dominate southern and western US, allowing for sunny and very hot days. However, more Canadian cooler systems are expected to turn south into the northeastern US, decreasing temperatures to comfortable for the region and lowering cooling outlooks.