Natural gas turns lower after weekly storage reprot
By Laura Mandaro, MarketWatch
SAN FRANCISCO (MarketWatch) — Crude-oil futures rose to over $99 a barrel Thursday, extending the prior session’s gains on a surprisingly deep inventory drop, getting an additional boost from positive data on U.S. jobs and consumer sentiment.
Natural-gas futures, however, retreated after a weekly storage report showed a lower withdrawal than some analysts had expected and inventories running at higher-than-average levels.
Oil for February delivery CL2G +0.81% rose 77 cents, or 0.8%, to $99.45 a barrel on the New York Mercantile Exchange. A higher close Thursday would mark oil’s fourth-straight up session; it’s added about 6% this week.
On Wednesday, oil had jumped 1.5% to $98.67 a barrel after the Energy Information Administration said crude supplies for the week ended Dec. 16 dropped 10.6 million barrels versus analysts’ estimates of a 2.25 million decline.
“Oil prices are profiting from the unexpectedly strong inventory reduction in the U.S.,” wrote analysts at Commerzbank, noting the gains have narrowed the price difference between West Texas Intermediate and Brent oil, the European benchmark, to about $9.
Early Thursday, the Labor Department said the number of Americans filing initial claims for unemployment insurance fell 4,000 to a seasonally adjusted 364,000 in the week ended Dec. 17, the lowest since 2008 and better than economists’ expectations. Read more on jobless claims.
“Commodities such as copper and crude oil continue to steadily climb, suggesting that sentiment toward the global economy, particularly the U.S., continues to improve on the back of another positive surprise in jobless claims,” wrote Colin Cieszynski, analyst at CMC Markets.
Oil slightly added to gains after a midmorning release of a consumer sentiment survey. A gauge of consumer sentiment reached 69.9 in the final reading for December compared with 64.1 in November, according to Thursday reports on the data from the University of Michigan and Thomson Reuters. Read more on consumer sentiment.
Natural gas for January delivery NG12F -0.29% fell 4 cents, or 1.1%, to $3.12 per million British thermal units after the EIA said natural gas in storage registered a net withdrawal of 100 billion cubic feet in the week ended Dec. 16.
Analysts polled by Platts had forecast a withdrawal between 99 billion cubic feet (bcf) and 103 bcf.
Some other surveys, from Dow Jones and Bloomberg, for instance, had pegged the withdrawal at around 105 bcf.
“After several weeks of bullish misses relative to expectations, observers may have been fooled into more aggressive estimates,” wrote Citi Futures Perspective analyst Tim Evans.
The EIA also said storage levels were 235 bcf higher than last year at the same time and 387 bcf above the 5-year average.
Evans that with the “current forecast calling for warmer-than-normal temperatures across most of North America,” and noted recent trends in inventory levels, “the context suggest more bearish data to follow.”
U.S. equities climbed while the dollar traded slightly higher.
