Prices increase by more than 15% in the third quarter
Crude-oil future prices for sweet light crude for November delivery which had ended at $81.62/bbl last week (21 Sept) finished 4 cents (0.04%) higher this week (28 Sept) at $81.66/bbl. Prices continued to stay above the $80/bbl mark throughout the whole week. It touched a high of $83/barel on Thursday, 27 September.
During the week, prices started on a weaker note around $80/barrel after the storm at Gulf of Mexico weakened and the place resumed back production. But then during the middle of the week, crude oil prices soared and were back at touching almost $83/bbl. Weak dollar, supply conditions and once again concerns regarding Iran’s nuclear policy took crude prices high.
But ultimately prices eased on Friday, 28 September, after refining margins shrank to their smallest in almost 11 months and heating oil and gasoline also tumbled.
As per this week’s inventory report by the Energy Dept, crude supplies rose 1.8 million barrels to 320.6 million for the week ended 21September (against an expected decline of 2.15 million barrels). Crude inventories are 3.5% lower than year-ago levels. U.S. stockpiles had fallen by a total of 18.3 million barrels in the previous four weeks. This was first gain in last five weeks.
Motor gasoline supplies climbed 600,000 barrels to stand at 191.4 million barrels. Distillate stocks were up 1.6 million barrels at 137.1 million barrels. Refinery utilization fell to 86.9% of capacity from 89.6% a week earlier.
The dollar has touched a record low against the euro for seven straight trading days. A lower dollar makes oil cheaper in the countries using other currencies.
Oil prices have risen 15% this quarter, the biggest quarterly percentage gain since the first quarter of 2005.
OPEC has planned to boost daily oil production by 500,000 barrels. OPEC's production target is 27.2 million barrels a day, beginning 1 Nov. OPEC, has decided to raise their daily output by 500,000 barrels per day, starting 1 November.