Crude Oil Prices

A look at crude oil prices and what effect they are having on the economy.

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Saturday, May 24, 2008

Oil prices roundup for the week ending May 23, 2008

It was a quite week for news on oil this week.  On Monday, President Bush signed a bill that forces his administration to temporarily stop buying oil to fill the Strategic Petroleum Reserve.  Bush signed the measure without comment.
 
Holly Corp. said a key unit at its New Mexico refinery was shut down for repairs, cutting estimated May gasoline production by 756,000 gallons per day.  This outage wasn't expected to significantly affect fuel prices.
 
Kazakhstan banned the export of all refined oil products, news agencies reported today.  The energy-righ Central Asian nation is grappling with soaring fuel costs.
 
On Wednesday the Energy Information Agency reported crude stocks fell by 5.4 million barrels. Analysts were expecting an increase of 900,000 barrel.  Crude imports averaged 9.2 million barrels a day last week, down 696,000 barrels from the prior week and 1.6 million barrels below the same week last year.
 
Gasoline supplies feel 800,000 barrels and distillate stocks rose by 700,000 barrels.
 
Refinery utilization rose to 87.9% of capacity.  This was a 1.3% increase from the prior week.
 
American Airlines said it was scrap 75 plances from its fleet and reduce the number of seats available on domestic routes by 11-12% this year.  It would also start charging $15 for the first checked bag on domestic flights.
 
On Thursday, the Paris-based International Energy Agency said it is worried about whether there is enough oil to meet global demand, and it is working on a review of the world's 400 largest oil field that could lead to a major revision in its closely-watched forecasts.
 
During a visit to Ecuador OPEC chief Abdala El-Badri said today that members are unhappy with surging oil prices that he blamed on speculators and a weak US dollar.
 
Qantas Airlines(Australia) said it will raise domestic and international air fares for the second time in less than a month in an attempt to offset soaring world oil and jet fuel prices.
 
International air fares will rise by about 4% and domestic fares by about 3% for tickets issued in Australia from June 4.
 
Federal Highway Administration data shows the number of miles American travelled fell 4.3 percent in March compared to last year.  This is the first time since 1979 that March year-over-year mileage has dropped.
 
Bankrupt Frontier Airlines announced new fees today, thanks to the rising oil prices.  If you want to carry home antlers you get during the hunting season the fee will now increase from $75 to $100.
 
It also plans to charge a $25 fee for a second checked bag, cancel half-price infant seats and take no more bookings for pets traveling in airplace cabins.  The fee for children traveling alone on Frontier flights will increase to $50 from $40.  It also plans to optimize it flght tracks using software based on air traffic and weather conditions, installing lighter leather seats, and the use of more fuel-efficient aircraft.
 
The number of rigs actively exploring for oil and natural gas in the United States increased by 27 this week to 1,889 according to the Baker Hughes Inc reported released today.  1,493 rigs were exploring for natural gas, 386 for oil and 10 were listed as miscellaneous.  One year ago the rig count stood at 1,760.
 
China has released 169,365 barrels of oil from its strategic petroleum reserve to help with the recovery from the earthquake which his the country a couple of weeks ago.
 
Marathon Oil Company spent $1.8 million in 1Q lobbying the federal government on environmental and other issues.
 
A monthly survey by Reuters found analysts expected crude oil prices to average $107.13 a barrel in 2008 up from $72.30 in 2007.  This was an increase of more than $10 from the last poll late in April.  They also expect prices to stay above $106 for 2009 and $102 in 2010, compared to $92 in the last poll, due to concerns over long term supply constraints and strong demand from emerging markets.
 
The National Oceanic and Atmospheric Administration said Thursday that is predicts a near-average hurricane season this year.  NOAA sees a 60-70% chance of 12 to 16 named storms, including six to nine hurricanes and two to five major hurricanes.  It was Hurricane Katrina that first sent gasoline prices above $3 a gallon.  Hurricanes often disrupt oil and natural gas production in the Gulf of Mexico.
 
Oil prices climbed to more record highs.  After starting the week in the $126 range it climbed as high as $135.09 before closing the week at
 
Gasoline price at the pump climbed from $3.79 a gallon on Monday up to $3.87 on Friday.  Many analysts are expecting $4.00 in the next week or so.  Gasoline futures climbed from $3.22 to as high as $3.43 a gallon.
 
Diesel prices climbed from $4.52 a gallon on Monday all the way up to $4.649 a gallon on Friday.  Heating oil futures climbed from $3.65 to $3.8656.
 
Natural gas prices finished the week at $11.857.
 
(See current oil futures chart at the bottom of the page)