Crude Oil Prices Surge on Strong European Demand and Short Covering

Strategic Insights -

Strong prompt physical demand in Europe for North Sea crudes, combined with short covering on the New York Mercantile Exchange (Nymex) before expiration of the April futures contract, sent crude oil prices sharply higher Monday. West Texas Intermediate (WTI) futures for April delivery soared 49 cents to $15.37/bbl on Nymex, while May WTI rose 39 cents/bbl to $15.23. May North Sea Brent futures climbed 35 cents/bbl to $13.98 on London's International Petroleum Exchange.

Key Takeaways:

  • Crude oil prices surged on March 21, 1994, due to strong European demand and short covering on the New York Mercantile Exchange (Nymex).
  • West Texas Intermediate (WTI) futures for April delivery rose 49 cents to $15.37/bbl, while May WTI rose 39 cents/bbl to $15.23.
  • May North Sea Brent futures climbed 35 cents/bbl to $13.98 on London's International Petroleum Exchange.
  • Physical Dated Brent rose 31 cents/bbl to $14.48 at Sullom Voe in the Shetland Islands, with Prompt Dated Brent premiumizing by 75-80 cents/bbl.
  • Traders expect Middle East sour crudes to begin finding their way back into the Mediterranean market along with rising Russian exports.
  • Refined products prices have been offsetting the recent rise in crude oil costs at U.S. refineries, but not in Europe.
  • Unleaded regular gasoline futures for April delivery to New York Harbor gained 0.70 cents to 46.62 cents/gallon, while April No. 2 heating oil futures increased 0.62 cents to 45.09 cents/gallon.
  • Low-sulfur diesel rose 0.06 cents to 53.90 cents/gallon, with April natural gas futures falling 4.8 cents to $2.055/MMBtu with the arrival of warmer temperatures.

Statistics:

  • West Texas Intermediate (WTI) futures for April delivery rose 49 cents to $15.37/bbl.
  • May WTI rose 39 cents/bbl to $15.23.
  • May North Sea Brent futures climbed 35 cents/bbl to $13.98.
  • Unleaded regular gasoline futures for April delivery to New York Harbor gained 0.70 cents to 46.62 cents/gallon.
  • April No. 2 heating oil futures increased 0.62 cents to 45.09 cents/gallon.
  • Low-sulfur diesel rose 0.06 cents to 53.90 cents/gallon.
  • April natural gas futures fell 4.8 cents to $2.055/MMBtu.

Sources:

  • The Oil Daily
  • Computer Petroleum Corp.
  • New York Mercantile Exchange (Nymex)
  • London's International Petroleum Exchange