Natural gas higher ahead of Futures fall from five-week high
By Claudia Assis and Clare Hutchison, MarketWatch
SAN FRANCISCO (MarketWatch) — Crude-oil futures traded lower Thursday, as some of the geopolitical fears left the market following media reports that Iran has responded to European Union attempts to resume talks on the country’s nuclear program.
Crude oil futures for March delivery CLH2 -0.22% fell 23 cents, or 0.2%, to $101.56 a barrel on the New York Mercantile Exchange.
Crude futures settled at a five-week high on Wednesday mostly on reports that Iran had halted oil supplies to the EU in retaliation to sanctions over its nuclear program.
Tehran denied cutting off supplies, but investors kept worrying about potential supply disruptions as the sparring between Iran, the third largest oil exporter after Saudi Arabia and Russia, and Western powers gave no signs of abating.
Iran has since replied to a letter sent in October by EU policy chief Catherine Ashton offering to re-open talks on the Islamic Republic’s nuclear program, the Wall Street Journal reported Thursday.
The response comes a day after President Mahmoud Ahmadinejad was seen on Iranian state television attending an elaborate ceremony held to unveil developments in Iran’s domestic nuclear program.
A higher dollar also pressured oil futures prices.
The euro lost ground versus the dollar EURUSD -0.15% , as uncertainty over a second Greek bailout grew.
Euro-zone finance ministers have reportedly discussed delaying the release of a 130 billion euro ($171 billion) bailout until after Greece’s elections, which may be held as soon as April.
The dollar index DXY +0.12% , which compares the U.S. unit to a basket of six currencies, traded higher, at 79.865 from 79.641 late Wednesday in North American trading.
A rising dollar is detrimental to commodities as it makes them more expensive to holders of other currencies.
Meanwhile, Brent crude traded moderately higher, with futures for April delivery up 88 cents, or 0.7%, to $119.77 a barrel. Brent closed at a six-month high the previous session.
Other energy products tracked Brent higher. For natural gas, also on table was the weekly U.S. government report. The March contract NGH12 +1.57% rose 3 cents, or 1.2%, to $2.46 per million British thermal units.
The Energy Information Administration is scheduled to report on natural gas supplies later Thursday. Analysts polled by Platts see a decline between 116 billion cubic feet to 120 bcf for the week ending Feb. 10.
A decrease within these lines would be smaller than the 230-bcf withdrawal in the comparable week in 2011 and the five-year-average decline of 178 bcf, according to EIA data.
March gasoline RBH2 +0.58% rose 1 cent, or 0.4%, to $3.02 a gallon.
