Crude prices gain 57% in FY 2007 marking the biggest yearly gain in five years
Oil prices fell for the second consecutive day today. Monday, 31 December, 2007. But today’s fall was limited. Prices fell as dollar strengthened against its rival currencies for the first time in six sessions. Nevertheless, crude ended FY 2007 substantially higher by $35 or 57%. It was crude’s biggest yearly gain in five years.
For the day ending Monday, 31 December, 2007, crude-oil futures for light sweet crude for February delivery closed at $95.98/barrel (lower by $0.02/barrel) on the New York Mercantile Exchange. Prices are 57% higher than the year before.
In the currency market today, the dollar index, which tracks the value of the greenback against a basket of other major currencies, rose for the first time in six days, up 0.5% to 76.695. The dollar strengthened against the euro today after an industry report showed sales of previously owned homes unexpectedly increased last month.
Also pressuring prices were forecasts for mild temperatures on the U.S. East Coast through mid-January.
Brent crude oil for February settlement today fell 3 cents to $93.85 on the London-based ICE Futures Europe exchange. The London benchmark has risen 54% this year, the most since 1999 when prices more than doubled.
Natural gas too remains very little changed
Natural gas futures were little changed as milder weather forecast in parts of the U.S. will reduce demand to heat homes and businesses. Gas for February delivery rose 1.6 cents (2.2%) to $7.402 per million British thermal units.
Against this backdrop, January reformulated gasoline gained 1.61 cents to $2.4758 a gallon and January heating oil rose 0.74 cent to $2.6444 a gallon.
At the MCX, crude oil for January delivery closed at Rs 3,763/barrel, lower by Rs 18 (0.5%) against previous day’s close. Natural gas for December delivery closed at Rs 296.3/mmtbu, higher by 7.1/mmtbu (2.4%).
Members of the OPEC left production targets unchanged at the 5 December meeting in Abu Dhabi. The group, which produces 40% of the world's oil, will review output at a 1 February, 2008 meeting in Vienna.
As per EIA, global oil markets will likely remain tight through 2008 and monthly average oil prices are expected to near $85 per barrel over the next year. The IEA, an adviser to 27 nations, said global demand in 2008 will rise 2.5% to 87.8 million barrels a day.
The New York and London markets will be closed tomorrow for New Year's Day.