Oil spot price: Brent and WTI steady ahead of US crude inventory update

on Jan 8, 2014
Updated: Oct 21, 2019
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_iNVEZZ.com: Wednesday, January 8th:_

**Crude oil**
Brent and West Texas Intermediate crude have so far today been holding steady above $107 and around $94 a barrel respectively, amidst new concerns for Libyan output and forecasts for a drop in US crude oil inventories.
In Libya, the eastern autonomists yesterday upped the political ante with Abd-Rabbo al-Barassi, notional prime minister of Jathran’s self-declared government in the eastern Cyrenaica region, proclaiming that “we welcome global oil companies” and that “the oil security guards will guarantee the safety of tankers”.

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JBC Energy analysts have this take on things Libyan: “The situation boils down to the central government being unable to access major export facilities without risking a prolonged and violent civil war and the separatists being unable to secure exports without access to naval forces.”
The US Energy Information Administration is due to release its Weekly Petroleum Status Report for last week at 15.30 UTC today, with analysts expecting a drop within a broad range of 900,000 to 2.8 million barrels, making for a sixth consecutive week of declines.

Yesterday, the American Petroleum Institute reported a much larger contraction last week, of some 7.3 million barrels, though up 1.2 million barrels at the Cushing, OK hub.
Phillip Futures analysts write in a client note that “despite ongoing strong crude production in the United States due to the shale oil and gas boom, the continuous fall in stockpiles denotes strong demand for the commodity”.

Brent’s premium over US crude is currently at $13.74 after earlier today reaching an intra-month high at $13.84.
**Natural gas**
The spot price of natural gas today jumped to a record high in New York City, reaching $90 per million British thermal units (1,000 cubic feet). In other states yesterday, the price was at levels not seen since 2004. The extreme cold has caused refinery failures and grid operators to tighten operating conditions and has created unprecedented demand for heating, but is seemingly on the wane with warmer weather ahead.

ICAP Energy LLC vice president Tom Hahn comments that “this is some pretty extreme cold” Hahn notes, “We are definitely seeing that reflected in the market, but it’s going to be short-lived”, with more normal winter temperatures due from tomorrow.

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