Suez Weekly Market Monitor
ERCOT power launched the week with a sharp increase in prices. Late in the week prices took an even sharper decline as the gas market eased off.
Northeast curves also reflected the early gains and late losses as seen in the ERCOT market. Prices across the region are holding close to their 52-week low.
PJM power in the eastern and western region held a fairly close relation as prices increased in the early week and declined in the latter part of the week.
Natural Gas Market
Natural gas ramped up early in the week. It soon peaked and began to decline late in the week.
NYMEX prices for the prompt month finished the week at $8.42/MMBtu an increase of 3.84% or $0.32/MMBtu.
Natural Gas Storage: Gas in Storage Decreased 32 Bcf
Working gas in storage was 3,417 Bcf as of Friday, November 24, 2006, according to EIA estimates.
This represents a net decline of 32 Bcf from the previous week.
OPEC May Seek Higher Oil Price on Weaker Dollar
OPEC may seek higher oil prices because of the dollar's decline against the euro, the pound and the yen, signaling growing support for a cut in crude production when members meet next week.
“Everyone is concerned” by the drop in the dollar, Qatari Oil Minister Abdullah Bin Hamad al-Attiyah told reporters today in Abu Dhabi, United Arab Emirates.
The Organization of Petroleum Exporting Countries, the supplier of 40 percent of the world's oil, prices and sells its output in dollars.
The group, which agreed to remove 1.2 million barrels a day from Nov. 1, should reduce sales for a second time when it meets in Nigeria on Dec. 14, officials from Iran and Venezuela said yesterday.
“Gulf oil producers may seek higher prices to compensate for the rising cost of importing nondollar goods and services, which make up about two thirds of imports,” Simon Williams, an economist for HSBC Holdings Plc, said in a phone interview from Dubai.
The dollar has fallen about 11 percent against the euro this year and by 3.8 percent in the past two weeks to end at $1.3336 per euro on Dec. 1, the lowest in 20 months.
This year's decline against the euro is the biggest since a 16.7 percent loss in 2003.
The Fed's Major Currency Dollar index, which gives a trade-weighted value for the dollar against a basket of seven currencies, has lost 6.6 percent this year.
“The weaker dollar is on their agenda because of inflation anxieties and because it erodes the value of their dollar-denominated overseas assets,” Williams said.
The Gulf states, including Saudi Arabia, Iran and Kuwait, pump about 70 percent of OPEC's daily output.
Crude oil for January delivery was at $62.80, down 63 cents, in after-hours electronic trading on the New York Mercantile Exchange at 11:04 a.m. in London.
The contract earlier rose as much as 39 cents to $63.82 a barrel.
OPEC agreed to cut daily output at a meeting Oct. 20 in Doha, Qatar.
By then, increasing stockpiles of crude had caused the price to slide by more than a quarter in New York from its July 14 record high of $78.40 a barrel.
Edmund Daukoru, Nigeria's top oil official and OPEC's president, said the 11-member producer group may trim supplies further to prop up prices.
Oil prices “could be a little higher,” Daukoru told reporters in Abu Dhabi today.
International Oil Companies
The weak dollar could also put more pressure on international oil companies such as Exxon Mobil Corp., Royal Dutch Shell Plc and ConocoPhillips that are already absorbing rising costs of boosting capacity, Jim Mulva, Conoco's chief executive officer, said today.
“All goods and services that are priced other than in dollars ends up costing more,” Mulva, who heads the third- largest U.S. oil company, said in an interview in Abu Dhabi today.
Shell, Europe's largest oil company, decided to go ahead with a project this year to build the world's biggest plant to convert gas into diesel fuel and base oils in Qatar at a cost of as much as $18 billion, three times the original estimate for the venture.
|Home :: Archives :: Contact||
November 28th, 2020
© 2020 321energy.com