Energy commodities: 10/02/10

Unless stated otherwise, all prices are for the close of February 9.

Brent crude oil futures: US$71.60/bbl, down 0.7 per cent, as of GMT 9:15, February 10
WTI crude oil futures: US$73.33, down 0.7 per cent, as of GMT 9.15, February 10
German power: €48.39/MWh, up 1.17 per cent
Coal: €92.75/t, up 1.64 per cent
Natural gas: GB 35.40p/therm, down 3.67 per cent
EUAs for December 10 delivery: €13.55/t, down 1.53 per cent
CERs for December 10 delivery: €11.86/t, down 1.58 per cent

Latest buzz
NYMEX crude closed up over two per cent on February 9, thanks to a weakening dollar, combined with strong performance on Wall Street and the snowstorm currently blanketing the US Northeast. The contract also gained momentum due to news that Germany is planning a financial bail-out plan for Greece. The latter’s economic woes have reached the point where they are triggering speculation regarding the future of the euro.

However, since then, a report from the American Petroleum Institute has indicated that in the past week, US crude inventories rose by 7.2mbbl to 337.6mbbl, much higher than the 1.5mbbl stock build expected by analysts. Gasoline inventories also rose, moving up 1.6mbbl to 228.8mbbl. There was also the bearish news that Chinese crude imports dropped down to 4.03mbpd from the 5mbpd seen in December. However, this is still up 33 per cent YoY.

The long-term indications for the natural gas market in the US are starting to look more challenging, as analysts from Barclays Capital are now predicting that the country might be on track for another record storage fill this year. They have cited a recovery in horizontal gas drilling, which now stands just below its 2008 peak and the fact that the EIA’s monthly statistics show that the lower-48 states, produced onshore 490MMcf/d MoM in November and a reduction in the backlog of drilled but incomplete wells, could push production higher into the first quarter.

Carbon prices over in the EU have taken a battering as financial institutions took a hard look at the gains made over the past four sessions and switched to profit-taking. Meanwhile, the CER market will be looking ahead to Friday, when two CDM project auditors, Tuev Nord and Tuev Sud, will learn whether they will be suspended by the CDM executive board for sub-standard project submissions. The two auditors are responsible for more than 30 per cent of all projects at the development stage and as a result, the decision will have a big impact on new CER issurance.