The total number of oil and natural gas rigs in the US decreased by 20 to 1,987 for January 13, 2012.
Oil Rigs: 1,196 | Gas Rigs: 791
Previous Week:
Oil Rigs: 1,196 | Gas Rigs: 811
Last Year:
Oil Rigs: 798 | Gas Rigs: 902
ERCOT
North: $0.02150
Houston: $0.02141
South: $0.02132
West: $0.01986
Reg Down: $0.00493
Reg Up: $0.00513
RRS: $0.00483
NYISO
NYC LBMP: $0.038895
PJM
AEP GEN HUB LMP: $0.029535
ISO NE
Mass. Boston Day Ahead LMP: $0.045175
MISO
Illinois Hub Hourly LMP: $0.03088
Northeast:
* Snow moves into the interior today, spreading towards the coast and into New England overnight
* Snowfall should transition to a lake-effect snow near Lakes Erie and Ontario overnight
* Highs will range from the single digits in northern Maine to the 40s in West Virginia and near Chesapeake and Delaware Bays
South:
* Dry and mild conditions are expected across the region
* High temperatures will be between 15-20 degrees above seasonal averages for much of Texas
* Highs will range from around 40 in western Virginia to around 80 in South Texas and South Florida
Mid West:
* One system will bring some snow to the Great Lakes and the Ohio Valley today and tonight, with some lake-effect snows developing near the Great Lakes behind it tonight
* A second system will move into the Plains and Upper Mississippi Valley tonight, bringing a chance of snow to these areas
* Bitterly cold wind chills are expected this morning in the Northern Plains, Upper Mississippi Valley, and the western Great Lakes, with colder than average temperatures expected in these areas today plus into the Central Plains and the Mid-Mississippi Valley
* Highs will range from single digits below zero in northern Minnesota to around 50 in western Kansas
West:
* Rain and snow will begin to shift southward into California and spread inland to the High Plains today into tonight
* Heavy snowfall is possible in the Cascades and the mountains of Idaho, western Wyoming, and northern Utah
* Windy conditions are expected at times in the Northern High Plains; combined with very cold temperatures, this will lead to bitterly cold wind chill values
* In contrast to the cold in the Northern High Plains, very warm (for January) temperatures are expected in the Four Corners and the Great Basin
* Highs will range from around -10 in northwestern Montana to the 70s in the Lower Colorado Valley and in eastern New Mexico
Natural Gas 12-Month Strip
Natural Gas Storage
Natural Gas Rigs vs. NYMEX Prices
Nat Gas/Crude Oil Correlation
3-Month Temperature Outlook
EIA (Energy Information Administration) reported a net withdrawal of 95 Bcf (billion cubic feet) for the week ending January 6, 2012.
Inventories are at 3,377 Bcf, which is up 13.4% or 398 Bcf from last year and 491 above the 5-year average or 17%.
Higher-than-average seasonal temperatures, coupled with continued high storage levels and consistent production, put downward pressure on natural gas prices again this week. The Henry Hub price closed at $2.81 per MMBtu on January 11, down 15 cents for the week.
At the New York Mercantile Exchange (NYMEX), the February 2012 natural gas contract slid 32.2 cents per MMBtu for the week to close at $2.774 per MMBtu, a life-of-contract low.
Working natural gas in storage eased slightly last week to 3,377 Bcf as of Friday, January 6, according to the U.S. Energy Information Administration’s (EIA) Weekly Natural Gas Storage Report (WNGSR). The implied net withdrawal for the week was 95 Bcf, positioning storage volumes 398 Bcf above year-ago levels.
The natural gas rotary rig count, as reported January 6 by Baker Hughes Incorporated, increased by 2 to 811 active units. Meanwhile, oil-directed rigs decreased by 2 to 1,191 units.
In the News:
EIA releases the Short-Term Energy Outlook – On January 10, 2012, the U.S. Energy Information Administration (EIA) released its monthly Short-Term Energy Outlook (STEO), the first STEO to include forecasts for 2013. Highlights of January’s STEO for natural gas include record volumetric increases in marketed production and inventories in 2011, as well as a significantly lower forecast for prices in 2012.
12/24-Month Strip (NYMEX) Price
12 Month Strip 24 Month Strip
$3.08 MMBtu $3.44 MMBtu
Crude Oil Price: $100.87 at 3:00 PM
Crude Slides in Late-Day Selloff
Oil futures fell nearly 2% in a late-day selloff after reports emerged saying the European Union’s possible embargo of Iranian oil imports would likely be delayed up to six months. New York Mercantile Exchange crude ended up closing below $100 a barrel for the first time in 2012.
Light, sweet crude futures for February delivery ended the day down $1.77, or 1.8%, at $99.10 a barrel on the Nymex. Brent crude on the ICE Futures Europe exchange was down $1.06, or 1%, at $111.18 a barrel. Nymex futures had not closed below $100 a barrel since Dec. 30.
European Union officials announced an agreement in principle Jan. 4 to halt imports of Iranian oil because of Iran’s nuclear development program, sending the oil market higher that day to a close of $103.22. Still, the announcement at the time lacked a concrete timeline and offered little in the way of precise parameters.
Iran is the world’s third-largest oil supplier, exporting 2.5 million barrels per day to global markets. If European countries reduced use of Iranian oil, it would increase dependence on other sources, tightening the global supply-and-demand balance.
Futures had been trading higher all day Thursday, driven higher by word of a possible shutdown of Nigerian oil exports and a stronger euro, even as the market looked past bearish new economic data and weak U.S. fuel demand fundamentals. But it began a steep selloff with less than an hour to go in the session as multiple news agencies, citing unnamed EU officials, said Europe’s Iran oil embargo could be delayed.
“That’s been the real driver behind this late-day selloff,” said Matt Smith, an analyst at research firm Summit Energy. “That’s been the only thing keeping prices in triple digits. Once you take the Iranian piece out of the puzzle, we’re left with poor economic data and poor U.S. fundamental crude data. This is definitely an unwinding of that [Iran] premium.”
Front-month February reformulated gasoline blendstock, or RBOB, lost 3.2 cents, to $2.7313 a gallon. February heating oil dropped 1.05 cents to $3.0541 a gallon.
The total number of oil and natural gas rigs in the US remained unchanged at 2,007 for January 6, 2012.
Oil Rigs: 1,196 | Gas Rigs: 811
Previous Week:
Oil Rigs: 1,198 | Gas Rigs: 809
Last Year:
Oil Rigs: 786 | Gas Rigs: 914
ERCOT
North: $0.02033
Houston: $0.02015
South: $0.02004
West: $0.00871
Reg Down: $0.00385
Reg Up: $0.00749
RRS: $0.00673
NYISO
NYC LBMP: $0.03841
PJM
AEP GEN HUB LMP: $0.03186
ISO NE
Mass. Boston Day Ahead LMP: $0.03746
MISO
Illinois Hub Hourly LMP: $0.023815
Northeast:
* Rain should mix with and change to snow overnight tonight from southwestern New York southward through western Pennsylvania and into West Virginia
* Gusty winds are expected across the region today and tonight, with some coastal flooding possible along the coast
* Temperatures are still expected to be warmer than average for much of the region, with highs ranging from around 20 in northern Maine to around 60 near Chesapeake Bay
South:
* Rain showers are expected in the Piedmont and coastal plains of Virginia and the Carolinas tonight
* Windy conditions are expected for much of the region, most notably in the Southeast
* Warmer than average temperatures are expected for the Southeast Coastal States, with colder than average temperatures expected in the Southern Plains and Lower Mississippi Valley
* Highs will range from around 30 in northern Arkansas to the 80s in South Florida
Mid West:
* Rain is expected today for eastern Kentucky, much of Ohio, and southeastern Michigan, mixing with and changing to snow overnight tonight
* Snow, sometimes heavy, is expected today and tonight in the Upper and Middle Mississippi Valley and the western Great Lakes
* Warmer than average temperatures are expected for much of Michigan and Ohio, with colder than average temperatures in the Plains and Mississippi Valley
* Highs will range from the single digits in northern Minnesota and northeastern North Dakota to around 50 in eastern Kentucky and southeastern Ohio
West:
* Mild temperatures are expected in California, with colder than average temperatures in parts of the High Plains
* Code orange air quality expected in parts of the Central Valley of California and parts of the San Francisco Bay area (including Chico, Sacramento, San Jose, Bakersfield, Fresno, and others)
* Highs will range from the teens in the higher elevations of the Rockies to the 70s in parts of Southern California and southern Arizona
Natural Gas 12-Month Strip
Natural Gas Storage
Natural Gas Rigs vs. NYMEX Prices
Natural Gas/Crude Oil Price Correlation
3-Month Temperature Outlook
