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Wednesday, July 01, 2009

Crude pares early gains

Crude registers highest quarterly gain in nineteen years

Crude prices ended lower at Nymex on Tuesday, 30 June, 2009. Prices fell today as consumer confidence in US showed unexpected drop for last month. Despite the drop, crude registered highest quarterly gain since 1990.

On Tuesday, crude-oil futures for light sweet crude for August delivery closed at $69.89/barrel (lower by $1.6 or 2.2%). During intra day trading, crude rose to a high of $73.38/barrel. Last week, crude ended lower by 1.2%.

For the month of June, 2009, crude ended higher by 5.5%. In May, crude had registered the largest monthly gain in a decade rising 30%. For the second quarter, crude ended higher by 40%. It was the largest quarterly gain for crude since Saddam Hussain's invasion of Kuwait in 1990's third quarter. Prices rallied in second quarter due to supply concerns and weak dollar. It had rallied 11.3% in the first quarter of 2009.

Oil prices had reached a high of $147 on 11 July, 2008 but have dropped almost 53.3% since then. Year to date, in 2009, crude prices are higher by 57%.

The Conference Board reported on Tuesday, 30 June, 2009 that reading on U.S. consumer confidence relapsed in June, falling to 49.3 from a slightly downwardly revised 54.8 in May. After a large confidence jump in May, consumers once again grew more pessimistic in June about their present and future. The present situation index declined to 24.8 in June from 29.7 in May, while the expectations index fell to 65.5 from 71.5.

Also at the Nymex on Tuesday, July reformulated gasoline lost 2% to $1.8972 a gallon, while July heating oil fell 3.7% to $1.718 a gallon. The gasoline and heating oil contracts expired today.

August natural-gas futures also fell, down 2.8% to stand at $3.835 per million British thermal units. Natural gas gained 1.6% in the second quarter.

Crude prices had ended FY 2008 lower by 54%, the largest yearly loss since trading began at Nymex.

At the MCX, crude oil for July delivery closed at Rs 3,344/barrel, lower by Rs 105 (3.04%) against previous day's close. Natural gas for July delivery closed at Rs 186/mmbtu, lower by Rs 6.4/mmbtu (3.3%).

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