Crude Oil Inventory Sends Prices Climbing

Crude Oil Inventory Sends Prices Climbing
Crude Oil Inventory Sends Prices Climbing
Crude oil is trading at 96.67 gaining 6 cents on Thursday morning after a strong trading day on Wednesday after markets pushed up prices on EIA inventory news. Crude oil futures settled at a one-month high after a report showed U.S. oil stockpiles rose less than expected last week. Oil inventories increased 200,000 barrels to 395.5 million barrels, the Energy Information Administration said. The rise pushed oil inventories to their highest level since the EIA began keeping weekly records in August 1982, though the gain was less than anticipated by experts and offset by a steep rise in fuel demand.

The market got a bit excited that the inventories for crude came in below expectations. Analysts surveyed were calling for an inventory rise of 1.7 million barrels. U.S. oil stockpiles have been rising steadily since the beginning of the year, fueled largely by a steady rise in domestic production. U.S. stockpiles are up roughly 10% year to date. Market participants said they were surprised by last week’s sharp pickup in demand, according to the EIA. The agency’s metric for refined fuel use rose 6.5% to 19.1 million barrels a day, although demand for gasoline–the biggest component–was essentially flat.

On Tuesday, the EIA said Saudi Arabia, the world’s biggest oil producer, boosted production 1.8% last month to 9.2 million barrels a day, the highest level since December. The data also showed overall output from members of the Organization of the Petroleum Exporting Countries rose to a five-month high.

China’s consumer inflation stayed subdued in April while factory-gate price declines deepened, giving the government room to raise utility prices. China’s CPI rose 2.4% in April, compared with a forecast of 2.3%. The producer price index fell 2.6%, after March’s 1.9% drop. On Wednesday, Chinese trade data showed a huge surge in exports increasing China’s demand for crude oil and raw materials. Exports increased by 14.7%, and imports also climbed.

Crude oil prices closed at a 4-week high, supported by a declining dollar against a basket of major currencies, rising global equity markets, and some upbeat trade data out of China.

Natural gas futures were up 1.5%, rebounding from a one-month low, but closed just below the key $4 per mmbtu level. Prices were supported by technical buying and bargain hunting ahead of Thursday’s inventory report despite concerns that moderating spring weather will continue to slow demand. Natural gas inventories are expected to increase by 80-85bn cubic feet, actual data will be released by EIA later in the day. Natural gas is trading at 3.949 continuing its sell off as energy traders more their focus to crude oil.

Crude Oil Trades In The Green

Crude Oil Trades In The Green
Crude Oil Trades In The Green
WTI crude was little changed after the first drop in four days as industry data showed U.S. stockpiles climbed for a second week. Crude oil fell to 95.60 range on Tuesday and has gained 12 cents this morning to trade at 95.75. Prices were pressured by a report that Saudi Arabia boosted its crude output by nearly 2% in April as traders await weekly updates on US petroleum supplies.

US oil inventories jumped 680,000 barrels, gasoline inventories fell 186,000 barrels, and distillate stockpiles, which include heating oil, rose by 1.1mn barrels, as per API report.  Last week there was a huge variance between the API report and the official EIA inventory. This week the forecast EIA inventory is expected to show a climb of 1.9 million barrels of crude oil.

The price of oil rose sharply this morning as an increase in U.S. hiring raised the prospect of higher energy demand. The contract jumped $1.62 to finish at $95.61 on Friday after U.S. employers added a surprisingly solid 165,000 jobs in April. That drove down the unemployment rate to a four-year low of 7.5 percent and suggested the U.S. economic recovery may be gathering pace.

Demand for oil also tends to increase when the economy picks up, as factories produce more, people drive more and businesses use more fuel to ship goods. Rising oil prices are just a matter of improving sentiment around global growth.

Sources familiar with Saudi oil policy said in late April that they expected external demand for Saudi crude to remain steady from March through June 2013. But Saudi Arabia’s own crude oil demand for power generation has jumped by an average of 147,000 bpd from March to April in the previous three years, according to a Reuter’s analysis of official data. The increase from March to April 2012 was much lower, however, at just 64,000 bpd, due to more gas supply coming on line in early 2012 to feed Saudi power plants. According to the latest Reuters survey, overall OPEC crude oil output rebounded in April from its lowest monthly level in more than a year due to the end of export disruptions in Iraq and Libya and a rise in Iranian sales.

Brent crude oil fell more than 1% on Tuesday as worries about market fundamentals curbed an early rise that had brought the price close to $106/barrel on strong German data and concerns about tension in the Middle East. Fears of supply disruption after the Israeli air strikes on Syria close to Damascus boosted Brent early in the session.

Natural gas continued to decline trading at 3.908 as speculators turn their backs on the commodity. With future demand showing promise, the US government continues to delay comment on rules and policy, while Japan shipbuilders are moving forward with investments in cargo ships to handle natural gas shipments. Natural gas futures fell below $4 per mmbtu mark, on forecasts for mild temperatures signaling waning demand as US stockpiles continue to climb.

Energy Speculators Turn Their Attention From Natural Gas to Crude Oil

Energy Speculators Turn Their Attention From Natural Gas to Crude Oil
Energy Speculators Turn Their Attention From Natural Gas to Crude Oil
Crude oil is trading at 95.27 down over 80 cents this morning after surging to trade over 96.00 on Monday. Yesterday crude oil futures were firm, mirroring the early morning gains on the New York Mercantile Exchange, where prices rose on supply concerns amid heightened geo-political tensions in the Middle East. Israel on Sunday morning conducted an air raid near Damascus in Syria, raising concerns that tensions in the Middle East might escalate and hit crude oil supplies. Prices of Brent crude oil shot up to more than $105 a barrel in electronic trade after nearly five weeks, on fears of disruption in supply, while on NYMEX, prices breached the $96-a-barrel mark. Crude oil futures closed higher for the third session in a row, as traders grew wary over the potential supply-and-demand consequences of geopolitical tensions in the Middle East. Israel over the weekend reportedly launched its second airstrike in three days in and around Damascus, Syria’s capital. The move raised concerns that violence will spread to other parts of the oil-rich region.

The euro traded in a range Monday on better than expected purchasing managers index from euro‐zone amid caution after European Central Bank president Mario Draghi indicated that the ECB could reduce rates farther if warranted. Retail sales in the eurozone edged down in March, an indication of the weakness in consumer demand that is hindering recovery in the 17‐nation currency bloc’s economy.

Saudi Arabia has increased its crude supply in April to 9.2 million barrels per day, from 9.15 million bpd supplied in March. Traders can expect crude oil prices to go down as expectations of higher inventories and demand concerns from euro zone are likely to bring down prices. Oil production in Saudi Arabia, the world’s largest exporter of crude, rose 1.8% in April.

Natural gas futures fell to a 1-month low on NYMEX, as moderating weather reduced demand for the heating and power-plant fuel. Natural gas fell below the $4.00 price level yesterday and is trading at 3.98 this morning. US natural gas futures ended lower on Monday as mild weather forecasts for the next few weeks hurt prices. Natural gas prices are expected to move down as the receding winter season will continue to put pressure on prices. Energy speculators have turned their attentions back to crude oil.

Crude Oil and Natural Gas Diverge

Crude Oil and Natural Gas Diverge
Crude Oil and Natural Gas Diverge
After gaining over $1.00 on Monday morning to trade at $96.66, celebrating better than expected jobs data from the US, traders will most likely see crude oil futures trade range-bound amid mixed global cues, as encouraging US non-farm data and the interest rate cut by ECB would lend some support to prices, while high inventory in the US and overall demand concern would restrict movement.

Though oil prices have recovered in last few sessions following recent announcements from the US Federal Reserve and Eurozone Central Bank, concerns regarding global economy have not fully eased. US Fed has announced its decision to continue its bond buying programme, while ECB lowered its main refinancing interest rate by 25 basis points. ECB President Mario Draghi also said monetary policy would remain accommodative, which boosted sentiments in the global market.

WTI crude oil inventory rose by 6.7 mln barrels from the previous week to 395.3 mln barrels in the week ended Apr 26, data released by the US Energy Information Administration showed. Market participants had expected crude oil inventory to increase by 800,000 barrels. Oil demand from the US is seen down, as the country is focusing on reducing its dependence on imports and increasing its production. Besides, a fall in China’s manufacturing Purchasing Managers Index is likely to restrict any additional sharp upside movement. China’s official manufacturing PMI fell to 50.6 in April, slightly lower from 50.9 in March. US and China are world’s largest oil consuming nations.

At the end of the week, the price of oil climbed as a better-than-expected U.S. jobs report pointed to growth and a rising demand for energy this year. Benchmark crude for June delivery was up $1.61 to $95.60 a barrel in late morning trading on the New York Mercantile Exchange on Friday after the release. Oil jumped after the Labor Department said that employers added a solid 165,000 jobs in April and far more in February and March than first thought. Job growth in April drove down the unemployment rate to a four-year low of 7.5 percent and sent a reassuring sign that the U.S. jobs market is improving.

Natural gas on the other hand lost its “market sweetheart” label, as traders turned their backs on the commodity and sold off in record numbers, after weather in the US turned warmer and a disappointing inventory release on Thursday. Natural gas had been trading as high as $4.40 as the commodity remained in the news headlines as global demand for natural gas increased and more pressure was placed on the US government to make decisions about future export rules and policy. This past week a surprising EPA report said that fracking was not as dangerous or bad for the environment as the “green” demonstrators had claimed. Natural gas continues its tumble this morning trading at $4.027 down by 24 pips. Traders can expect natural gas to tumble to its medium trading price around $3.26 now that summer weather has arrived.

Easy Monetary Policy and Interest Rate Cut Sparks Crude Oil Rally

Easy Monetary Policy and Interest Rate Cut Sparks Crude Oil Rally
Easy Monetary Policy and Interest Rate Cut Sparks Crude Oil Rally
WTI crude oil skyrocketed yesterday by almost $3.00 reflecting traders being caught between a drop in gasoline prices and support from the ECB rate decrease and strong jobs data in the US. Crude oil climbed to trade at $93.99 on the close. This morning oil gave back a few cents in the Asian session trading at $93.80. The rise in crude oil prices caught a lot of traders by surprise after a record high inventory report the previous day. Crude supplies rose 6.7 million barrels for the week ended April 26. Analysts polled by expected a 1.4 million-barrel climb. Motor gasoline supplies declined by 1.8 million barrels, while distillate stockpiles rose by 500,000 barrels. Forecasts called for a decline of 900,000 barrels for gasoline, with distillate stockpiles expected to be unchanged. The jump in prices reversed sharp losses on Wednesday tied to glum economic data.

The European Central Bank’s quarter-point reduction in its benchmark interest rate, to a record low of 0.50 percent, was expected but it provided the underpinnings of a rally in oil. Also helping was the weekly US jobless claims report, which came in much better than expected, suggesting some tightness in the jobs market. But the main boost to prices, a $1.75 jump in New York’s WTI benchmark futures contract, came hours after those announcements. The widely expected ECB move on Thursday is part of efforts to boost demand and stimulate growth in the debt-stricken eurozone. In the United States, new claims for unemployment benefits – an indicator of the pace of layoffs, fell by 18,000 to 324,000 for the week ending April 27, as reported by the Labor Department. It was the lowest level since January 2008. The strong US dollar also weighed heavily on prices but traders still managed to push prices upwards.

Traders can expect crude oil prices to go up on improved prospects of crude demand. However, US non-farm employment numbers and unemployment rate today are likely to keep investors cautious to get clarity on the health of US economy.

Natural gas plunged 7%, after the EIA weekly report showed a steep rise in US gas inventories, suggesting waning demand for the fuel used to heat homes and generate electricity. Natural gas stockpiles climbed by 43bn cubic feet to 1.777 trillion cubic feet, according to the US Energy Information Administration. Natural gas is trading at 4.041 dropping close to 30 cents yesterday. News flow on exports and increased demand along with the newly released EPA report showing that fracking was not as bad for the environment as previous thought had been supporting prices.

Gold Stuck Between Central Bank Decisions

Gold Stuck Between Central Bank Decisions
Gold Stuck Between Central Bank Decisions
China’s manufacturing growth expand at slower pace A private gauge of Chinese manufacturing declined in April, adding to sign that growth in China will cool for a second straight quarter. The final reading of HSBC PMI was at 50.4 compared with 51.6 for March.

Not many hours before the Chinese data release, the US Fed maintained its current QE pace, with a comment that said it will keep buying bonds at a monthly pace of $85 bn while standing ready to raise or lower purchases as economic condition evolve. The key interest rate kept unchanged at the conclusion of two-day meet in Washington. The Fed said yesterday that it was ready to raise or lower its monthly asset purchases as economic conditions evolve, in contrast with a discussion of the timing of a reduction in the pace of buying at the central bank’s March meeting. Gold ETP assets fell to 2,272.281 metric tons yesterday, the least since October 2011, according to data compiled by Bloomberg.

“The Fed’s message yesterday could have been interpreted as positive for gold but it also reminded investors of the possibility of less stimulus should the economy show steady improvement

Ahead of markets today is the all-important ECB meeting where they may cut interest rates as economy weakens further ECB may cut interest rates by 25bps in its policy meet as the 17-nation economy has shown increasing weakness in recent weeks. However, economists think a reduction in rates without accompanying efforts to boost bank lending is unlikely to make much difference at this juncture.

Gold is trading at 1453.35 after peaking at 1461.75 ahead of the FOMC announcement. Gold has had a difficult time recovering since its 200 point drop in mid-April. Gold tumbled from 1520 to a low of 1320 in just about a 24 hour period. Over the past weeks physical buying has supported prices while ETF’s continue to sell off at record rates. Several central banks have increased their gold reserves also helping to keep prices rebounding, but overall gold faces a bearish outlook. Recently a lower US dollar has helped support prices. The US dollar was trading in the 83 price range but tumbled to trade at 81.73 this morning.

Gold prices in spot and futures market are likely to head further south today as investors choose to offload their holdings in exchange-traded funds. In early Asian trade, the precious metal fell below the psychological mark of $1,450 an ounce, cause enough to rekindle fears of a crash. In general, the commodities market is seeing a selling trend in almost all commodities and gold is no exception.

Gold’s fall is despite the US Fed Reserve’s decision to continue its current monetary policy of pumping money into the economy. Holdings in SPDR Gold Trust, world’s largest exchange-traded fund that holds gold in electronic form have dropped to their lowest since September 2009 to 1,075.23 tons. Traders are unsure what to expect from the ECB today, leaving gold along with silver and the entire precious metals family

 

 

 

Crude Oil and Natural Gas Continue to Rally

Crude Oil and Natural Gas Continue to Rally
Crude Oil and Natural Gas Continue to Rally
US markets surged higher on Monday on the back of a strong rebound in pending home sales and a better-than-expected increase in personal spending. Positive cues from the corporate earnings front also boosted the investor confidence.  All good news yesterday helped the overall commodities market to trade in on a positive note for the day. Crude oil continue to climb, trading as 94.50 at the close yesterday and giving back only a few pips today to trade at 94.33. This morning data in Japan was lower than expected by had a silver lining. Japan’s industrial production growth rate came in less-than-expected at a seasonally adjusted 0.2% for March 2013 against an expectation of 1.3%. The corresponding figure for the previous month was 0.6%. While unemployment fell to 4.1%. In the US lower tier data also helped support the climb as reports showed that consumer spending rose in March, advancing by .2% and coming in better than expected. Personal spending also rose by .2%.

Today’s focus will be on the US Federal Open Market Committee (FOMC) which start its two day meet for deliberations upon the monetary policy including the continuance and quantum of quantitative easing program. Most traders are expecting the FOMC to hold its current course as data over the past weeks has been fairly weak. There is not much expectation in any announcement about future tapering of the programs.

The sharp climb in based on the upcoming European Central Bank meeting scheduled for Thursday as traders now expect the ECB to reduce its key lending rate by 25 bps to help stimulate growth in the eurozone, which is falling behind in recovery efforts. Although the eurozone’s confidence numbers came in lower, the euro appreciated by 0.53%, closing at 1.3099. Data expectations from the eurozone and Germany which might pressurize the euro may affect crude oil prices later today. From the US, consumer confidence number is likely to improve due to a recovery in the US economy which may support the dollar.

US natural gas moved higher on Monday on cooler weather forecasts for the week. Natural gas futures were up more than 3% during intra-day trades on NYMEX, as investors focused on forecasts for persistent cold temperatures and tightening gas inventories. Natural gas prices are expected to move in a range as the receding winter season is likely to prevent further upside in prices. Front-month gas futures on the New York Mercantile Exchange ended up 16.9 cents, or 4 percent, at $4.392 per million British thermal units after trading between $4.225 and $4.395. Natural gas also remained in the global headlines as the clean burning lower price energy supply is finally seeing a boost in demand as more and more businesses and commercial users shift away from coal and oil and make the investment to move to natural gas.

Lackluster Eco Data and Poor GDP Weigh On Crude Oil Prices

Lackluster Eco Data and Poor GDP Weigh On Crude Oil Prices
Lackluster Eco Data and Poor GDP Weigh On Crude Oil Prices
WTI crude oil is trading at 92.66 easing back after it looked destined last week to trade above 94.00. Crude oil futures declined on Friday after trading in a narrow range, as disappointing first-quarter US economic growth raised worries over the outlook for energy demand.

The US economy grew more slowly than expected in the first quarter, expanding 2.5% versus expectations of a 3.2% rise. China’s first-quarter economic growth slowed to 7.7% on a year-on-year basis, disappointing economists who had expected a median 8%, according to a Journal survey. The data suggest China’s economic growth is slowing after a second-half revival last year. It also helps explain why Chinese officials in recent weeks have opened liquidity floodgates and pumped new money into the system.

India has cut down the import of crude oil from Iran by over 26.5% to about 13.3mn tons in the financial year ended 31 March 2013, as the US and European sanctions has made it difficult to ship oil from the Persian Gulf nation.

Even the weakness in the US dollar has not been able to support prices. The US dollar tumbled from the mid-83.50 range to trade this morning at 82.38 which should help support oil prices.

The last weekly report from the Energy Information Administration also showed oil stockpiles last week rose less than expected, while gasoline inventories fell sharply. Energy speculators found a number of bullish cues in the EIA report. Oil inventories last week rose 900,000 barrels, less than the increase of 1.2 million barrels forecast in a Dow Jones Newswires survey of analysts. Gasoline stockpiles tumbled 3.9 million barrels last week, the EIA reported, while stockpiles of distillates, including heating oil and diesel, rose 100,000 barrels. Refinery utilization fell 2.8 percentage points to 83.5% of capacity. This helped push crude oil price to climb up to the 94.00 price level on Thursday as prices eased on Friday and continue to dip this morning by 34 cents.

Natural gas fell for last week on speculation that fuel demand will slump after a shot of unusually cold weather in the US helped increase residential demand. Natural gas is trading at 4.277 gaining this morning as weather forecasts changed over the weekend calling for another week of chilly weather. Exporting of US natural gas remains in the headlines as Shell and Japan try to push the US government for some commitments to when they will allow an increase in exports so that future demand can be met. US gas stockpiles increased by 30 billion cubic feet to 1.734 trillion in the week ended April 19, the EIA said yesterday. Supplies were 31.8 percent below a year earlier and 5.1 percent below the five-year average, down from a deficit of 4.2 percent the previous week. Natural gas for May delivery fell 5.6 cents, or 1.3 percent, to $4.111 per million British thermal units on the New York Mercantile Exchange at 1:11 p.m. Futures have more than doubled in the past year and have been trading above $4 for three straight weeks.

 

Crude Oil Climbs Ahead Of Today’s EIA Inventory

Crude Oil Climbs Ahead Of Today's EIA Inventory
Crude Oil Climbs Ahead Of Today's EIA Inventory
Crude oil continues to gain in the Asian session adding 41 points to trade at 89.59, still well below the 94-96 price range earlier this month. There has been very little supporting data to aid a price rally. Markets have seen very little positive data over the past weeks, US data has been lackluster and Chinese data has been disappointing, while the eurozone seems to keep sinking deeper into the Abyss.

The decline in oil came after preliminary data showed manufacturing activity in China slowed in April due to sluggish foreign demand. The HSBC purchasing managers’ index (PMI) for the month came in at 50.5, from 51.6 in March. A reading above 50 indicates growth and anything below points to contraction. When added to last week’s Chinese GDP release, it becomes obvious that China has rebounded but the turnaround is not as strong as markets expected. Both reports were fairly positive just below forecasts and expectations.

The gloomy news was a survey showed that private sector business activity remained weak across the Eurozone in April, underscoring a gloomy medium-term outlook for the 17-state economy. Both the Eurozone report as a whole and German data disappointed traders. The Markit Eurozone Composite Purchasing Managers Index (PMI) registered 46.5 points, the same reading as March. But German data missed expectations by a big number.

Adding this to comments over the weekend from G20 leaders at the end of their summit as they seemed to turn their views from austerity to growth and the IMF and World Bank statements pushing growth and noting the weakness in the Eurozone weigh heavily on energy demands.  There is an underlying growth-in-demand prospect with the upcoming US stockpiles data. This is fuelling positive sentiment and balancing generally softer economic data.

Due later today is the US, EIA inventory report on crude reserves in the country for the week ending April 19. Changes in US inventory stocks are closely watched by dealers as they indicate levels of demand in the world’s top crude consumer. Traders are torn between poor global economic releases and prospects of draws in inventory levels in the United States. Housing data reported lackluster results missing expectations but beating previous reports. Both existing home sales and new home sales missed expectation.

Supporting prices are rumors that OPEC is considering reducing production to help support prices. There is a meeting set in May, but rumors say they might call an emergency meeting if prices continue to decline for Brent oil.

Natural gas remains well into the 4.00 price range trading this morning at 4.27 flat from yesterdays close as investors will wait for Thursday’s inventory report. Gas climbed above 4.40 earlier this week but fell as traders booked profits and the chilly late winter weather turned to warmer spring temperatures. The future demand for natural gas exports from the US continue to push the government to make some decisions now so that the infrastructure and future plans can be made. Japan is leading the push for exports of US natural gas.

 

 

 

Crude Oil and Natural Gas Decline After Weak Housing Data

Crude Oil and Natural Gas Decline After Weak Housing Data
Crude Oil and Natural Gas Decline After Weak Housing Data
WTI crude oil is giving back some of yesterday’s gains to trade at 88.83 down by 36 pips and continuing to decline after a lackluster PMI report from China this morning. Crude oil climbed Monday, with Brent crude back above $100 a barrel, as prices recovered from last week’s sell-off of more than 3%. Monday’s move comes on the heels of last week’s steep gains, attributed to concerns about weakening oil demand and stabilizing global supply. Brent fell under $100 a barrel for the first time since July. Signs of weak global oil demand have been a drag on oil prices in recent months, following demand growth downgrades from the Organization of the Petroleum Exporting Countries, the International Energy Agency and the Energy Information Administration.

This morning Chinese HSBC PMI manufacturing data printed at 50.50 showing continued expansion but at a slower rate than markets had expected. The forecast was at 51.40 based on estimates of growth in China and factory increases. Last week Chinese GDP data also failed to meet expectations printing at 7.7% which is respectable growth, but the forecast was for growth at 8%. This sparked a huge tumble in the commodities market with gold tumbling the most in one session in close to 30 years, while crude oil followed suit.

Sales of US existing home sales also declined yesterday missing forecasts and weighing on energy commodities. Previously owned U.S. home sales unexpectedly dropped in March as a lean supply of properties kept the industry from generating a stronger recovery. Purchases of existing houses, tabulated when a contract closes, fell 0.6 percent to a 4.92 million annual rate.

Crude oil inventories increased again by 2.6 MB and reached 1,781.8 million barrels. The linear correlation between the changes in stockpiles remained mid-strong and negative: this correlation implies that the price of oil, assuming all things equal, will decline again next week.

Furthermore, oil imports to the U.S also rose by 0.4% last week. The weekly developments in oil imports have a mid-strong negative relation, which suggests oil prices may further decline next week. Oil production and refinery inputs also rose last week. In other words, the rise in supply suggests the oil market has slightly loosened in the U.S.

Gains in US equity markets helped supported dollar index and in turn helped US crude futures to move ahead further. Bargain hunting was also seen due to lower crude oil prices overall.

However, overall demand still look slump and over increasing stockpile of crude oil has pressurized crude oil prices overall. Traders can expect crude oil prices to move down today as poor home sales data from US has increased the worry over US economy. Also inventory is expected to increase which can pressure the prices downwards.

Natural gas continues its decline as traders sell off to book profits after natural gas hit a recent high over 4.40. The commodity is trading at 4.274 down 19 pips this morning. US natural gas futures moved down on Monday for the first time in last five sessions due to milder weather forecasts that should finally slow heating demand after few more days of cold weather.

 After a late spell of chilly weather increased residential demand, the weather forecast is now calling for more spring like temperatures as winter is now behind. Traders will wait to see how much inventory was used during the cold front last week. Natural gas is expected to continue to ease below the 4.00 price range.

Crude Oil Range Bound Ahead Of Chinese Data

Crude Oil Range Bound Ahead Of Chinese Data
Crude Oil Range Bound Ahead Of Chinese Data
Crude oil is trading at 88.69 up by 42 cents as traders await tomorrow’s HSBC Chinese PMI data. Last week disappointing Chinese data sparked a global commodities sell off seeing gold tumbled the most in 30 years while crude oil fell close to $6.00 in a single day. Crude oil climbed back above $88 per barrel, as traders mulled the prospects for an output cut from the OPEC Countries after a recent slump in prices left oil with a loss of almost 4% on the week.

Even after posting the biggest gain since March 26, a decline in oil prices is expected to carry on throughout the week amid lingering worries about higher crude supplies in the United States and signs of lower global demand. Most importantly, the trading sentiment towards commodities and energy precisely was strongly rippled last week by a round of downbeat projections for global oil demand, with lower growth for 2013 predicted by the IEA, EIA and the OPEC.

The International Monetary Fund trimmed its global economic growth forecast for 2013. The group has cut growth in the U.S., the world`s top oil consumer to 1.9 percent from 2 percent. China, the world`s second-top consumer, was cut to 8 percent from 8.2 percent.

Figures from China also showed that the growth in the world`s second oil consumer unexpectedly stalled in the first quarter of this year, triggering a sell-off this week in the oil markets, and pushing prices to a fresh low in 2013.

Bargain-hunting after the recent steep selloff is helping to support prices of WTI crude oil and Brent.  News of lower exports of Nigerian crude oil buoyed prices of European benchmark Brent crude, which had tumbled in the past six sessions to its lowest level since July 2. U.S. benchmark crude has dropped by more than $10 a barrel from highs in early April, as domestic crude oil and gasoline inventories have climbed, while demand for fuels remains sluggish. Front-month Brent, has fallen by about $12 a barrel this month, and the three-day string of prices below $100 a barrel is the longest since June 2012.

Representing 12 countries, including Qatar, UAE, Bahrain, Oman and Kuwait at International Monetary and Financial Committee meeting at Washington DC on Friday, Sultan N Al Suwaidi, Governor of UAE Central Bank, said high oil prices have positively impacted the performance of oil exporters. However, the growth performances across the Middle East region are mixed with considerable risks to the outlook from continued regional tensions and difficulties in the global economy.  He said inflation is expected to remain subdued in the Middle East. He said IMF support is needed to help many countries in the region avoid he medium-term challenges of high unemployment and sluggish growth. 

Natural gas is trading at 4.388 down by 49 pips this morning after having a record week. Natural gas futures rose to a 21- month high on NYMEX, capping the ninth weekly gain in a record streak, on speculation that forecasts of unusually cold weather next week will increase heating-fuel demand. Gas is expected to remain in a tight range ahead of this week’s inventory report, while slight declines may be expected as traders book profits.

Energy Speculators Turn From Crude Oil To Natural Gas

Energy Speculators Turn From Crude Oil To Natural Gas
Energy Speculators Turn From Crude Oil To Natural Gas
WTI crude oil is slowly regaining its footing after tumbling over the last few days. Crude oil is trading at 88.16 up by 15 pips. While the darling of the market today is natural gas, which surged by 5% yesterday after EIA inventories dipped more than expected as chilly weather blanketed the US increasing residential demand. Natural gas is trading at 4.399 down 20 points this morning as traders corrected the rally from yesterday and also the break above 4.40 triggers sell and profit points.

US natural gas prices have doubled during the last year, and that’s bringing sighs of relief from an unusual variety of interests. Soaring production and an unusually warm winter sent prices plunging to under $2 per thousand cubic feet last spring, prompting some to wonder whether the natural gas boom would kill demand for both coal and new renewable energy.

But natural gas is now just over $4 per thousand cubic feet. Energy experts say prices in the $4 or $5 range won’t affect the increasing use of the fuel by consumers and industry since the price was $8 just a few years ago. In Europe and Asia prices are even higher – $10 to $14.

There is a slow shift in energy demand as users are slowly moving from more expensive sources such as coal and oil to less expensive natural gas.  

Market rumors are flowing saying that the OPEC cartel would cut output ahead of a meeting next month to stop Brent crude prices – which remained below $100 a barrel – from falling further. The Organisation of Petroleum Exporting Countries (OPEC) earlier this month kept its world oil demand forecasts for 2012 and 2013 virtually unchanged, with China expected to contribute the most to growth while industrialized countries appeared to be headed for a decline. Sanctions-hit Iran, OPEC’s fourth largest producer, said on Wednesday that it considers the “logical” price of crude to be around $100 to $120 a barrel.

Analysts said the $100 price for Brent is considered ideal by Saudi Arabia, the world’s top oil exporter, and crossing below it could prompt the oil cartel’s members to cut back on production. Brent crude climbed toward $100 a barrel on Friday, stretching its gains into a second straight session after a steep 6-day fall, although worries about higher crude output in the United States and lower global demand kept a lid on prices.

But front-month oil prices were set to fall more than 3 percent for the week, their third straight weekly drop, pummeled by a cut in oil demand forecasts by global energy agencies and a slew of weak economic data from the United States and China, the world’s two largest oil consumers.

 

 

 

Growth and Demand Outlooks Weigh On Crude Oil

Growth and Demand Outlooks Weigh On Crude Oil
Growth and Demand Outlooks Weigh On Crude Oil
Crude oil continues its decline this morning trading at 86.75 down by 23 cents as growth and recovery downgrades weigh heavily on the commodity. U.S. crude futures for May delivery closed down by $2.04 at $86.68 a barrel, down by 2.3% on Wednesday. Crude prices were down on concerns over weak global oil demand after the IMF cut its global growth forecast to 3.3%. The International Energy Agency said that falling crude prices was evidence that the oil market is well supplied, putting additional pressure on prices. However, crude inventories unexpectedly fell by 1.2M which prevented further downside in prices.

Oil prices have fallen almost 7 percent in the last five days on expectations of sluggish demand from the U.S. and China, the world’s two biggest economies. The price of Brent crude oil has tumbled 18 percent from a peak of $118 a barrel in February to below $98 this week. Weaker-than-expected economic data from the U.S. and China over the past week have heightened concerns that the global economic outlook is not as strong as many expected just a couple of months ago. But the fall in oil prices provides a silver lining, say analysts. Yesterday the US Fed Reserve released its “Beige Book” which reviews the state of the US economy and is a guide for the FOMC. The assessment released Wednesday said overall activity is growing at a moderate pace, which is better than the report six weeks ago in which the economy was growing at a “modest to moderate” pace. According to the report, most of the nation saw increases in manufacturing, though the labor market was either unchanged or improved slightly. There were reports of hiring in manufacturing, residential construction, information technology and professional services.

Oil’s fall comes as part of a wider commodities rout triggered by data released Monday showing growth in China, the world’s second-largest oil consumer, had slowed unexpectedly in the first three months of 2013.Brent crude futures for June delivery hit a low of $96.75 before paring losses to trade at $97.32 early on Wednesday, down 37 cents. Brent stretched its losses into a seventh session – its longest losing streak since October last year.

Oil prices were also under pressure given risk of political uncertainty in the euro zone, where Italy’s divided parliament begins voting for a new state president on Thursday, a crucial step towards resolving the stalemate since the inconclusive election in February and to carry on with fiscal reforms.Investors seemed to shrug off news of Shell declaring force majeure on Nigerian Bonny Light crude oil exports. The company said it was shutting down the 150,000-barrel-per-day Nembe Creek pipeline in Nigeria for repairs.The stronger US dollar is also weighing on prices as equity markets fell around the globe yesterday, traders moved to the safety of the US dollar.

Natural gas prices also eased to trade at 4.189 giving up 19 pips this morning as the dollar strengthened as traders sold off to book profits, with natural gas breaking above the 4.20 mark activating sell orders. U.S. natural gas ended higher as chilly weather forecast boosted the heating demand and supported prices. Inventories today are expected to be positive which could push prices down. However prices are likely to move in a range before the data.

Crude Oil Inventory & Growth Downgrades Weigh On Prices

Crude Oil Inventory & Growth Downgrade Weigh On Prices
Crude Oil Inventory & Growth Downgrade Weigh On Prices

Crude oil is trading flat this morning at 89.04. Traders continue to absorb the IMF report released yesterday with a downgrade of 2013 growth expectations. Crude oil futures closed on a flat note on Tuesday, taking a break after a 3-session decline with a weekly round of US supply data on tap, but concerns about demand kept pressure on prices. Crude oil supplies tumbled 6.66mn barrels, distillate fuel inventories increased 1.26mn barrels and gasoline stockpiles rose 253,000 barrels to 22.6mn barrels according to the API data release on Tuesday. Traders will closely watch today’s EIA weekly inventory release.

Last week crude oil slowly began to decline from the 94.00 price range, on concerns, the International Energy Agency and the Organization of the Petroleum Exporting Countries reduced their global oil-demand growth estimates for the year slightly. Beside that the EIA, IAE and OPEC revised downward the growth forecast and demand for energy over the near term. Crude oil inventories last week also reported the highest inventory in 20 years. The Organization of Petroleum Exporting Countries (OPEC), the International Energy Agency (IEA) and the US government’s Energy Information Administration all downgraded their demand forecasts for 2013 this week. Weak US retail sales and slumping industrial output in Europe, as well as an upcoming downward revision to the GDP outlook from the IMF, have piled on top of this week’s downward revisions to oil demand prospects.

Economic data on Monday showed that U.S. consumer inflation fell 0.2% in March, in part led by lower energy costs. Analysts were looking for a 0.1% decline. Industrial production rose a bit more than expected, to a seasonally adjusted 0.4% in March. Crude oil production in North Dakota, the No. 2 U.S. oil-producing state, hit an all-time high in February but will really accelerate in May after bad weather and road restrictions end, the state’s Department of Mineral Resources said on Tuesday.

Concerns over Chinese growth and recovery are also affecting demand. China’s most recent data showed that the economy grew by 7.7% in the first quarter against expectations of 8%.

Adding a bit of pressure on crude prices, the U.S. dollar traded modestly higher early Wednesday, with the dollar index rising to 81.917 from 81.781 late Tuesday in North America. The US dollar had been trading in the mid 82.00 price range at the opening of the week. A rising dollar can often act to depress prices in crude oil and other dollar-denominated commodities, as it makes them more expensive to holders of other currencies.

Natural gas closed higher, in a seesaw session with light profit-taking pressure finally overwhelmed by supportive weather forecasts that should underpin heating demand through most of April. Natural gas is trading at 4.179 down by 7 pips, as the energy product remains in the headlines with increasing demand for exports helping to support prices. Also a late season storm and chilly weather are helping to increase residential demand.

The Bottom Falls Out Of Crude Oil

The Bottom Falls Out Of Crude Oil
The Bottom Falls Out Of Crude Oil
WTI crude oil continues to decline this morning trading at 87.97 down by 1.06 after tumbling on Monday. Crude oil closed with a loss of nearly 3%, supported by weaker-than-anticipated quarterly economic growth and monthly industrial production numbers from China, adding to worries about global demand for the commodity.

Late last week, US retail sales for March fell by 0.4%, which was sharper than expected. Retail sales in the world’s largest economy were up 1.1% in February. The May delivery crude oil contract on the NYMEX fell below the key psychological level of $90 a barrel on Monday, as fear of a fall in demand deepened on release of weaker-than expected Chinese growth data. WTI Crude oil futures breached the crucial support of US$89/bbl., weighed by weak global demand forecasts from various agencies. Crude oil broke in one day a psychological barrier and an important support line, opening the commodity to further declines.

China’s implied oil demand rose 3 percent in March from a year earlier to about 9.72million barrels per day (bpd), the lowest since August 2012, Reuters calculations based on preliminary government data showed yesterday. Chinese refineries processed 5.5 percent more crude oil in March than a year earlier, data showed, as state-run firms ramped up operations amid steady margins.

For the past week global eco data has showed a stall in recovery, compounded by the IMF downgrade of growth forecast and the EIA, IEA and OPEC lowering the demand for oil products. The US recovery has been thrown into doubt after a major surprise in the US labor market as seen in the nonfarm payroll print, followed by falls in retail sales, manufacturing and housing.

Crude prices were down as weak China GDP data further weakened the demand outlook for oil after poor economic data from US pushed prices down. Concerns over the euro zone recession also weakened the global demand outlook for crude and hurt prices. Crude prices also followed a decline in all major international commodities and a stronger dollar also weighed on prices.

U.S. natural gas ended lower due to profit taking and after touching a 2 year high in the previous session. Natural gas is trading at 4.149 gaining 11 points this morning. Moderate weather forecasts for the week are likely to push natural gas prices down. With poor eco data the export demand for gas may also reduce. Natural gas futures shrugged off chilly forecasts for the next 2-weeks and closed down for the first time in 4-sessions, due to profit booking, after the front contract in overnight trade posted its highest mark in more than 20-months. 

Crude Oil Tumbles After China’s GDP Misses Expectations

Crude Oil Tumbles After China's GDP Misses Expectations
Crude Oil Tumbles After China's GDP Misses Expectations
Crude oil is tumbling this morning after Chinese GDP data reported below forecast. Crude oil has tumbled 1.35 to trade at 90.25 at the end of the Asian session.  China’s gross domestic product rose 7.7% from a year earlier in the first quarter, down from growth of 7.9% in the fourth quarter of last year, China’s National Bureau of Statistics said this morning. The increase was slower than a median 8% gain forecast. Retail sales in China printed at forecast. The decline in oil came as lackluster data printed in the US on Friday. Weaker than expected retail sales in the US for March set a weak tone for the commodity markets. Retail sales suggest that growth in the US economy is struggling to gain momentum as the effects of tighter fiscal policy begin to impact. The modest 0.5% growth in sales over the past 3 months implies relatively anemic growth in the all-important domestic sector of the US economy.

Crude oil declined during most of last week: WTI decreased by 1.52%; Brent oil, by 0.97%. As a result, the gap between the Brent oil and WTI contracted again to its lowest level since July 2012; the gap between Brent and WTI ranged between $10 and $12. OPEC and IEA monthly reports came out last week. They showed the global supply is stable while the demand is weak. According to the latest EIA report, oil stockpiles rose by 5.9Mb. Moreover, imports, production and refinery inputs also rose again during last week. The rise in oil supply may have also dragged down the prices of oil.

The oil inventory rose by 5.9 MB and reached 1,779.1 million barrels. Moreover, the oil imports to the U.S also increased again by 0.6% last week. The weekly shifts in oil imports have a mid-strong negative relation (-0.33) that implies oil prices may fall next week. In other words, the rise in imports suggests the supply rose and thus may loosen the oil market in the U.S.

On Thursday, the International Energy Agency (IEA) cut its forecast for global oil demand growth this year by 25,000 barrels per day (bpd) to 795,000 bpd, citing weaker-than-expected oil use in developed economies, particularly Europe and Japan, as well as Russia and India.

The IEA cut its forecast of growth in global oil demand for the third straight month. The US Energy Information Administration (EIA) and the Organization of the Petroleum Exporting Countries also revised their forecasts lower last week.

Natural gas continues its climb as a freak unexpected storm pounded the US over the weekend. Natural gas is trading at 4.277 up 17 pips this morning as speculators are hoping that residential demand for heating will help lower inventory this week. Last week’s inventory surprised traders reporting a drop in levels.

Crude Oil Hit By Downgrades By Multiple Agencies

Crude Oil Hit By Downgrades By Multiple Agencies
Crude Oil Hit By Downgrades By Multiple Agencies
Crude oil prices closed lower yesterday after the International Energy Agency (IEA) trimmed its forecast for oil demand growth this year, the third of the world’s top forecasters to do so at a time of growing supplies. The IEA cut its forecast of growth in global oil demand for the third straight month. The US Energy Information Administration (EIA) and the Organization of the Petroleum Exporting Countries (OPEC) also revised their forecasts lower this week. This weakness continued to flow on Friday morning with crude oil losing 23 cents to trade at 93.28. The world’s top oil forecasters this week all cut their 2013 oil demand forecasts due to subdued economic growth, with the figures showing increasing similarity in the views of producers and consumers. International Energy Agency has cut its outlook for global oil-demand growth to 795,000 barrels per day from a previous forecast of 820,000 barrels per day, adding to existing worries that demand is fading. International Energy Agency has cut its outlook for global oil-demand growth to 795,000 barrels per day from a previous forecast of 820,000 barrels per day, adding to existing worries that demand is fading.

Data due in the US today, could have a strong effect on the commodity, with US retail sales and consumer confidence due later in the trading day. US retail sales figures for March are due out and they have posed somewhat of a puzzle during the first two months of 2013 as incomes took an immediate hit as a result of the increase in payroll taxes to start the year – and consumers should have anticipated a further tax hike looking ahead to income tax season this spring. It was the stress and worries of the “fiscal cliff” and sequestered budget cuts that kept consumer leery but with all that now in the past traders are expecting to see a better print.  Aside from retail sales, the U of M consumer confidence survey for March is due out

Iran’s crude exports declined in March to the lowest this year as international sanctions aimed at the Persian Gulf country’s nuclear program and weaker global demand cut purchases, the International Energy Agency said. At the same time tensions in the Korean region remain high as global trader’s watch John Kerry’s visit to the region in helps of cooling tensions between South and North Korea.

China imported 23.05mn tons of crude oil in March, equivalent to 5.45mn barrels per day, as per preliminary data from General Administration of Customs.

Natural gas is trading at 4.161 easing back a bit as traders booked profits after gas hit a recent high at 4.167 on Thursday. Natural gas rose to a 20-month high on NYMEX, after a government report showed that US stockpiles fell more than expected last week. The US Energy Information Administration said supplies on natural gas in the week ended April 5, dropped 14bn cubic feet to 1.673 trillion cubic feet.

Crude Oil Giving Back Some Gains After EIA Inventory

Crude Oil Giving Back Some Gains After EIA Inventory
Crude Oil Giving Back Some Gains After EIA Inventory
Crude oil is trading in the red this morning priced at 94.39 down by 26 cents. Crude fell from its highest level in more than a week, after US crude inventories soared to their highest levels in 22 years and OPEC cut its demand forecast. The API inventory early in the day on Wednesday showed a gain of 5.1 million barrels sending crude oil tumbling, but later in the day the official EIA inventory was release to the contrary. The inventory showed an increase of 250,000 barrels last week to 389 million barrels, the highest since July 1990. 

While the oil market took cue from the strong performance from the equities with Japan steadfast on an economic stimulus plan, oil prices weakened after the US crude stockpiles data was released. 

Yesterday’s release of Fed minutes seemed to indicate that many Fed members would like to see the asset purchase program toned back at the earlier possible time, but all seemed to agree that would depend on the labor market, which on Friday produced a disastrous result for March with new jobs creation falling to 88k against expectations of 200k assuring markets that the FOMC would continue its programs in the near term. President Obama introduced his 2014 budget yesterday; over 1100 pages in all, traders and analysts are just beginning to digest it overnight.

Meanwhile, the OPEC also revised its global oil consumption forecasts trimming demand to 800,000 barrels from an earlier estimate of 840,000 last month. Brent crude oil prices fell dragged down by a steep sell-off in US gasoline futures after a US government report showed an unexpected build in domestic gasoline inventories. New producing countries are set to redraw sub-Saharan Africa’s oil and gas map over the next five years, contributing to a significant net increase in output and attracting the top global companies.

Korea said on Wednesday there was a very high probability that North Korea, after weeks of threats of war, would test-launch a medium-range missile at any time as a show of strength which also supported prices. NYMEX oil prices had risen earlier due to concerns over supply disruption following reports that a strong 6.3 magnitude earthquake has hit southern Iran.

Natural gas futures rose, as investors looked at forecasts showing colder US temperatures over the next week that is likely increase gas-fired heating demand. Natural gas inventories are expected to decline by 25-30bn cubic feet, actual data will be released by EIA later today. 

Growth and Korean Tensions Effecting Crude Oil Prices

Growth and Korean Tensions Effecting Crude Oil Prices
Growth and Korean Tensions Effecting Crude Oil Prices
WTI. crude slipped today as much as 0.3% on the NYMEX, heading for the first decline in three days, after the API said inventories gained 5.1 mn barrels last week. Crude oil is trading at 93.92 this morning. Strong Chinese trade data should help support prices along with the ongoing Japanese stimulus. Yesterday, the UK saw positive reports for Industrial and Manufacturing production which also helps increase demand. Crude oil prices rose on yesterday, posting their biggest gain since late December as a weak dollar and tame Chinese inflation data drew investors to commodities. China’s daily crude oil imports in March fell 2.1 percent versus a year earlier, customs data showed on Wednesday, as some refineries started maintenance programs amid high fuel stocks. The turnaround in Chinese data caused the Asian Development Bank to upgrade its growth forecast for China to over 8%.

International oil prices rose on the back of upbeat quarterly earnings from Alcoa and supportive inflation data from top energy consumer China, analysts said. Brent North Sea crude for delivery in May won 42 cents to $105.08 per barrel in early afternoon deals in London. NY’s main contract, West Texas Intermediate light sweet crude for May, added eight cents to $93.44 per barrel. The market had already rallied on Monday in a technical rebound after last week’s sharp fall on poor US jobs data.

Anticipation of a refinery ramp-up in preparation of the US driving season is also keeping the West Texas Intermediate market buoyed. However, traders should not get too carried away with this optimism. While there is room for increased distillate production (stockpiles are currently extremely low), gasoline inventories are largely in line with their seasonal 5-year average.

Tension between North and South Korea today as the North announced a mid-range missile launch, which has pushed the US and South Korean alerts up on notch. Oil prices found some support from worries over increasing tension in North Korea and a stalemate in talks between Iran and Western nations, raising fears of a possible disruption to fuel supplies from the Middle East.

Analysts say the Brent-WTI spread could narrow further as European concerns weigh on Brent, while the start-up of a new pipeline will alleviate a glut of crude at the Cushing, Oklahoma, hub for U S oil, and keep the US crude contract well supported.

Oil markets await U S inventory data for the week ended April 5. Data last week showed an inventory build last seen in 1990, dragging oil prices down to an eight-month low on Friday. A Reuter’s analyst’ survey showed crude stockpiles were expected to rise by 1.5 million barrels. 

 The U.S. Energy Information Administration on Tuesday trimmed its estimate for growth in domestic natural gas production in 2013, but still expects output to rise 0.3 percent from 2012’s record levels. Natural gas has been trading near record highs earlier in the week but traders sold off to book profits as gas rose towards 4.15. Natural gas has drifted down from its high but is trading in the green this morning at 4.037 as winter 2013 draws to a close. Export demand continues to keep prices over the 4.00 level.

Traders Selling Brent and Crude Oil Spreads

Traders Selling Brent and Crude Oil Spreads
Traders Selling Brent and Crude Oil Spreads
This morning WTI crude oil is trading at 93.61 adding 25 cents since the market opened. West Texas Intermediate oil traded near the highest level in almost a week. U.S. crude stockpiles probably increased from the largest in more than two decades, a Bloomberg News survey showed before a government report.

Yesterday, crude oil prices closed higher, lifted by gains in gasoline futures and strong selling of the spread between Brent crude and US crude. Brent’s premium to US West Texas Intermediate futures closed at $11.3 per barrel, after narrowing to just over $11 in afternoon trade, the lowest level since June.

Venezuela’s production of crude and natural gas liquids has stabilized at 3.12million barrels per day after state oil company PDVSA halted a decline in output from the OPEC nation’s second-most productive region, Oil Minister Rafael Ramirez said in an interview on Monday. South Sudan will start marketing crude from the end of May after resuming oil production on Saturday, its oil minister said on Monday now that the two Sudan’s have finally reached agreements.

Brazil’s oil regulator, the ANP, said yesterday that it authorized Chevron to restart output from an offshore oil field more than a year after a November 2011 spill forced the No. 2 U.S. oil company to stop Brazilian production.

Last week crude prices were pressured by a slowdown in US manufacturing activity and weak growth in US job markets which has raised demand concerns and hurt prices. A shutdown of a pipeline which carries 90000 bpd due to an oil spill has also lead to a supply glut at the delivery point, thus putting additional pressure on prices. Crude prices also fell significantly as inventories rose to a 22 year high and came at 2.7 million barrels. Ongoing tensions between North Korea and South Korea seemed to have eased after China rebuked North Korea’s rhetoric.

Energy speculators today will watch the US as Alcoa kicks off the first-quarter earnings season after the stock market closes Monday. Analysts expected the aluminum giant to report slightly lower earnings compared to a year ago. Overall, Wall Street is looking for improved earnings from many companies as the economy shows signs of strengthening.

The minutes from the Federal Reserve’s last meeting will be released Wednesday afternoon. That may give investors more insight into the central bank’s view of the economy and prospects for the Fed’s bond-buying stimulus program to continue at its current pace.

Natural gas declined from a 20-month high on profit-booking, as warmer-than-normal temperatures arrived in key Mid-west and East Coast markets. Natural gas was trading close to 4.16 late on Monday when traders began selling off to book profits, pushing natural gas to trade at 4.053 this morning.