Japan’s leading refiner, Nippon Oil Corp. declared plans to refine 4 percent less crude in June from a year ago, a company executive declared on Friday, as domestic demand for oil products remains sluggish. For full story, click here
Crude oil fell on Tuesday, snapping four days of gains, on concern a U.S. government report will show stockpiles climbed from the highest level since September 1990. Crude oil for June delivery declined as much as 77 cents, or 1.4 per cent, to $53.70 a barrel in electronic trading on the New York Mercantile Exchange. Oil is up 21 per cent this year.
Japan’s top refiner Nippon Oil Corp. said that it expects to refine 22 percent less crude oil in March from a year earlier, due to slump in domestic demand and global economic crisis. For more information, click here
The jump was all too clear. A surprise drop in U.S. oil inventories caused crude prices to jump 14 per cent on Thursday, in New York, powering a broad commodities rally that pushed copper and corn higher. The only noticeable drop was in gold, which closed lower for the first time in three days.
The United States government statement that U.S. employers had slashed over a half million jobs in January, the highest yet in 35 years, lead to crude oil prices dropping just below $41 a barrel, way below the high of $147 a barrel last summer. There is a link between layoffs and the demand on oil, say analysts, as those laid off see no need for the daily commute, and buy less of petroleum products like toys and raincoats.
Another rough day for investors this Monday. As it became clear that the American House of Representatives would reject the authorization law for the executive’s $700 billion financial sector bailout plan, commodities began to tank. Oil futures shed more than $10 of their value during the day, dropping to $96.37 per barrel.
Though ConocoPhillips (NYSE:COP) and Placid Refining Company are both receiving hundreds of thousands of barrels of crude from America’s federal reserves to continue refinery operations, and two rigs in the Gulf have been knocked adrift, the overall impact of Ike appears fairly benevolent to energy companies.
Oil prices are being pushed upwards by the impending arrival of tropical storm Gustav in the Gulf of Mexico. Gustav is projected to become “the largest hurricane in the Gulf of Mexico since Katrina”. Workers are already being evacuated from oil and gas rigs in the area, which has pushed up NYMEX oil futures past $117.
At this point, there are much more pressing threats to the pipeline’s continued functioning. A long simmering dispute between Georgia and Russia over the disputed South Ossetia region erupted into war. Reports on Monday morning confirmed that Russian forces had pressed along the Greater Liakhvi River, beginning to enter the city of Gori.
Less mixed has been the effects of the long oil trading boom on the New York Mercantile Exchange itself. NYMEX Holding Inc (NYSE:NMX) has more than doubled its quarterly profit since last year. The market is in the process of being acquired by CME Group Inc (NASDAQ:CME).
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