This commentary is from USAK’s Energy Review Newsletter
http://www.turkishweekly.net/energyreview/TurkishWeekly-EnergyReview10.pdf
To subscribe email to energyreview@turkishweekly.net
When compared with previous weeks, this week was so quiet for the oil markets. In previous weeks there were problems of Iran, weather conditions, OPEC decisions etc.
However, this week’s important event can be stated as the steps taken in Venezuela for the nationalization of Venezuelan oil. In this framework, Chavez government made deals with Total and BP for the compensation of seizure of Jusepin oil field in 2006. The compensation paid will be in oil not in cash. Moreover, ExxonMobil has agreed to cede the control of Cerro Negro heavy oil project by May, 1.
On the other hand both prices of Brent and WTI decreased slightly this week. As known the tension increased last week due to the dispute between Iran and the US. However, expectations turned to positive after the news about warming weather in the US. In the end of this week the closure was around $60.5 for WTI whereas $60.22 for Brent oil.
Source: Financial Times
Moreover, the negative relation between decreasing stocks and increasing prices in heating oil preserves its trend. As can be seen from the below graph the distance between the two line becomes wider every passing month. The retail price of heating oil became $2.49 per gallon and stocks declined for about 1.3 million barrels in the US markets.
Source: Energy Information Administration
In the first week of March the stock values in the US declined not only in heating oil, but also in crude oil and gasoline. The decline was 3.75 million barrels in gasoline and a drastic decrease, 4.85 million barrels in crude oil.
Source: Energy Information Administration
In this week’s agenda there is an OPEC meeting in Vienna on 15th of March. A new cut is not expected for now. The price level seems stabilized in the band of $55-$65 and everybody more or less happy with these levels when compared with this summer’s high prices. On the other hand, unfortunately the dispute between the US and Iran has not been resolved yet and the US insists for further sanctions against Iran in UN’s Security Council.
According to a Bloomberg’s Survey 13 of 40 analysts expect a price rise while 9 of them expect oil prices to decrease and the rest is neutral about oil prices this week. Mark Shenk from Bloomberg claims that according to the US National Weather Service, the temperatures will be above normal from March 14 to March 22.
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This commentary is from USAK’s Energy Review Newsletter
http://www.turkishweekly.net/energyreview/TurkishWeekly-EnergyReview10.pdf
To subscribe email to energyreview@turkishweekly.net
