Crude oil reversed its decline on Friday and continued to climb this morning to trade at 107.20 adding 60 cents in the Asian session. During the previous
A tropical depression strengthened into tropical storm Fernando on Sunday in the Gulf of Mexico, the U.S. National Hurricane Center said, though the country’s main oil exporting ports remained open according to the latest official report.
Based on the recent EIA weekly update, oil stockpiles decreased again by 2.8Mb. In the U.S, imports, production and refinery inputs declined during last week. This week, several reports may affect the oil market. These items include: China’s manufacturing PMI, U.S GDP, U.S core durable goods, and EIA oil weekly report.
Natural gas could be the dominant power source for the next two decades in the western United States, even under the most aggressive climate scenarios, before making way for solar, findings from the University of California Berkeley suggest. Natural gas is trading at 3.56 gaining 39 points this morning after a steady climb on Friday as weather forecasts call for higher temperatures in the US over the holiday week. This combined with energy producers switching their excess capacity needs to natural gas as crude oil continues to trade well above the 100 level moving back over 107 on this morning. According to the Energy Information Administration, natural gas consumption in the residential/commercial sector slightly rose in recent weeks. Moreover, consumption in the power sector also grew as utilities companies continue to use natural gas to generate electricity. Therefore, the total demand for natural gas rose in recent weeks. The recent rise in power sector and residential/commercial sector is keeping the total demand rising. This is likely to push back up the price of natural gas.
Despite the recent increase in consumption, the EIA shows that in the power sector during the first five months of 2013 consumption fell by 15.2% compared to the same time frame last year. Conversely, the demand in the residential/commercial sector rose by 21.4% during the first five months of 2013. In total, the demand for natural gas increased by 3.6% up to May 2013. From the supply standpoint, natural gas production continues to fall. Natural gas is expected to remain in its trading range for the next few days.