Petroleum futures were falling further in the overnight session on Friday amid losses in European shares and in US stock market index futures, as well as further strength in the US dollar, despite a potential tropical storm in the Gulf of Mexico. Market participants awaited the weekly US rig counts from Baker Hughes for further direction.
Reuters reports that Chevron Corp. and Occidental Petroleum Corp. said they were withdrawing staff and implementing storm precautions at their Gulf of Mexico offshore facilities ahead of a tropical storm, which is expected to hit the Louisiana and Mississippi coasts later today. According to the National Hurricane Center, Potential Tropical Cyclone Three has formed in the central Gulf of Mexico and is seen moving northward and then northeastward towards the central Gulf Coast from Intracoastal City, LA to the Okaloosa/Walton Country line, FL, including New Orleans.
The CPI in Japan rose 0.3% in May, while expectations called for a 0.2% dip in prices. The Bank of Japan kept monetary policy settings unchanged, as expected. The Nikkei closed 0.19% lower and the Shanghai Composite edged down just 0.01%, while the Hang Seng added 0.85%. In European news, the PPI in Germany rose 1.5% last month, well above expectations at 0.6%. Retail sales in the UK fell 1.4% in May, while the Econoday consensus called for a 1.8% increase. As of this writing, the CAC 40 was down 0.62%, the DAX had lost 0.98%, and the FTSE 100 had dropped 1.14%. US stock market index futures were seeing losses of between 0.1% (Nasdaq f) and 0.5% (Dow f). Also unsupportive for crude prices, the US dollar index was up 0.1%.
Petroleum futures settled in the red with losses of over one percent yesterday amid strength in the US dollar, mixed trade in global equities, and a Norwegian oil worker wage agreement. Brent crude lost $1.31 to $73.08/bbl and WTI crude dropped $1.11, settling at $71.04/bbl. RBOB futures fell 2.20 cents to settle at $2.1342/g and ULSD (HO) settled 3.66 cents lower at $2.0668/g. According to Platts, the New York Harbor ULSHO barge price differential strengthened by 75 points to -16.00c/g, while ULSD and HSHO differentials held steady at +0.00c/g and -31.75c/g, respectively. June propane prices were flat to higher yesterday. Per Platts, Mt. Belvieu LST prices rose 50 points to 97.000c/g and non-LST prices strengthened by one cent to 97.250c/g. Conway prices remained steady at 94.750c/g.
Natural gas futures edged up just 20 points, settling at $3.253/mmBtu amid a supportive weekly storage report from the EIA. The EIA reported a 16bcf injection into underground storage for the week ended June 11, well below expectations at 72bcf.
