Oil prices continue to rise, gas price declines

By Sam Fletcher
OGJ Senior Writer

Oil prices continued climbing albeit at a slower pace, following a rise in the equity market after the Federal Reserve Bank reiterated its commitment to low interest rates into 2014 and generated the largest 1-day market percentage gain in weeks.

“The Standard & Poor’s 500 Index gained 1.4% on the day, benefiting from the Fed’s remarks as well as brighter expectations for growth in the Chinese economy in the first quarter from surveyed economists (they were wrong),” said analysts in the Houston office of Raymond James & Associates Inc.

“Ironically, a short-term spike in weekly jobless claims may have also fueled the bulls yesterday, as many saw the data point as increasing the likelihood that the Fed might initiate another round of easing,” they said. “Crude followed the broader markets to close a percentage point higher. Natural gas, on the other hand, remained flat at sub-$2/Mcf levels in spite of a weekly storage build well below expectations.”

James Zhang at Standard New York Securities Inc., the Standard Bank Group, reported that gasoline remained the leader across the complex, and middle-distillates also were strong following an earlier government report of a hefty fall in product inventories (OGJ Online, Apr. 11, 2012). He said, “Despite the rally in flat price, the very front end of Brent time spread fell further, with the May-June Brent spread trading below 20¢/bbl after hitting $1/bbl at the end of February. In contrast, the front-end of West Texas Intermediate spread rallied during the last few sessions as the pace of stock build at Cushing, Okla., has slowed sharply. The back end of the time spread, however, rallied sharply, and implied volatility for long-dated contracts also rose. Both suggest that substantial producer hedging volume might have gone through during the day.”

Total product stocks in the Amsterdam-Rotterdam-Antwerp region and in Singapore fell as spring maintenance of refineries in the northern hemisphere continues. “Clearly, refineries in Europe have responded to the very strong gasoline crack by scarifying middle distillate yield. In Singapore, total product stocks fell by 400,000 bbl week-over-week as the fall in fuel oil stock outpaced a rise in middle-distillate stock. Broadly speaking, product inventories are fairly comfortable in both regions as inventories of most product groups remain above their previous 5-year average levels,” said Zhang.

Energy prices

The May contract for benchmark US light, sweet crudes gained 94¢ to $103.64/bbl Apr. 12 on the New York Mercantile Exchange. The June contract increased 92¢ to $104.10/bbl. On the US spot market, WTI at Cushing, was up 94¢ to $103.64/bbl.

Heating oil for May delivery advanced 5.14¢ to $3.17/gal on NYMEX. Reformulated stock for oxygenate blending for the same month rose 6.12¢ to $3.36/gal.

The May natural gas contract dipped 0.1¢ but closed essentially unchanged at a rounded $1.98/MMbtu on NYMEX. On the US spot market, gas at Henry Hub, La., dropped 2.2¢ to $1.89/MMbtu.

In London, the May IPE contract for North Sea Brent increased $1.53 to $121.71/bbl. Gas oil for April was unchanged at $999/tonne.

The average price for the Organization of Petroleum Exporting Countries’ basket of 12 benchmark crudes lost 92¢ to $117.80/bbl.

Font: www.ogj.com

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About Lone Star Sealing Technologies
Lone Star Sealing Technologies was founded in 2004 to better serve the customers of Lone Star Fasteners and Walker Bolt. Our core product line consists of API Ring Joint Gaskets, Proprietary Wellhead Gaskets and Spiral Wound Gaskets. We also provide specialty cut gasket services for our OEM clients as well as general distribution for Raised Faced and Full Faced flange gaskets to ANSI B16.5 dimensions. LoneStar have a variety of high quality of gaskets and other options for fluid sealing applications built to endure, even under the toughest conditions. You can be confident that we go to every extreme to make sure that our products are built to perform. As manufactures and distributors of industrial gaskets for the oil and gas, and petrochemical industries, we know that it takes to produce quality that lasts and we continually tweak product lines in an effort to improve even the most proven gasket in the industry. In 2005 Lone Star acquired the assets of K&W Manufacturing, a Houston based API Ring Gasket producer. Established in 1964, K & W Manufacturing is an industry leader, among a few selected manufacturers in the world, approved by the American Petroleum Institute to apply the API monogram to Ring Joint Gaskets. In 2006 Lone Star acquired Grange Gaskets and Grange Precision Engineering (now Lone Star Grange) based in Leeds, England. Since 1948, Grange has been one of the United Kingdoms premier specialty gasket companies, specializing in Heat Exchange Gaskets of all types and configurations. Grange is world renowned for it's specialty clad gasket capabilities and quick service on spiral wound gaskets.

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