Oil prices rebounded on Friday but remained below US$50 a barrel after declining 4 percent over the past week due to rising US supplies of crude and natural gas.
Strong demand during the Northern Hemisphere winter could push prices higher in the weeks ahead, analysts said, though it depends on how fast depleted heating oil inventories grow and how severe the winter is in the Northeast and Midwest, the major consuming regions for this fuel.
Violence in the Middle East and labor tensions in Nigeria are other factors that could affect oil prices in the near term.
Crude for December delivery rose US$0.79 to settle at US$49.61 a barrel on the New York Mercantile Exchange. In London, Brent crude futures rose US$0.41 to US$46.42 on the International Petroleum Exchange.
Oil prices fell US$2.06 in New York on Thursday, closing below US$49 for the first time since Sept. 24, after the Energy Department reported that the amount of natural gas in storage grew more than expected last week. This followed a report showing that the US oil supply also grew.
Natural gas futures fell by US$0.249 on Friday to US$7.95 per 1,000 cubic feet (28.3m3) -- a decline of 9 percent in the past week.
Despite the broader trend lower this week, oil prices moved higher on Friday because traders were fearful of being "short," or betting that prices will fall, ahead of the weekend, when a terror attack or some other unexpected supply disruption could occur.
Marshall Steeves, an energy analyst at New York-based brokerage Refco, said he would be "a bit cautious" about declaring that an oil market peak was reached late last month.
"But I would say things have cooled off for the time being," he said.
Steeves said geopolitical strife and colder-than-expected temperatures could jump-start another price rally, while the absence of these events -- and growing fuel supplies -- would likely result in lower prices. He expects the price of oil to trade "US$4 or US$5 on either side of US$50 a barrel" for the remainder of the year.
The recent downtrend in oil prices was kicked off last week by an Energy Department report that showed US supplies of crude growing. The agency reported another sharp increase in commercially available crude inventories this week, helping prices fall by more than US$6 since hitting a record US$55.17 a barrel on Oct. 22 and Oct. 26.
The US oil supply is now just 1 percent below year-ago levels at 289.7 million barrels.
"Crude inventories have been building in the United States and that is a result of production [returning] that was temporarily stopped due to Hurricane Ivan," said Victor Shum, an oil analyst in Singapore for Texas-based Purvin & Gertz.
Nearly 28 million barrels of crude output have been lost since the hurricane swept through the region, but daily output has gradually increased.
Analysts said imports of light crude were also on the rise due to the high price sellers can get in the US.
This extra crude is expected to be put to use by refiners, who are completing pre-winter maintenance in time to take advantage of high prices for their products, particularly heating oil.
The nation's supply of distillate fuel, which includes heating oil, diesel and jet fuel, is roughly 12 percent below year-ago levels and an area of concern ahead of winter.
"It will be interesting to see if we can develop enough" heating oil, said Marshall Adkins, managing director of energy research at Raymond James in Houston. "We may end up with a bottleneck in the refining area."
Heating oil futures declined by US$0.0151 to US$1.357 per gallon on Friday.
Taiwan Transport and Storage Corp (TTS, 台灣通運倉儲) yesterday unveiled its first electric tractor unit — manufactured by Volvo Trucks — in a ceremony in Taipei, and said the unit would soon be used to transport cement produced by Taiwan Cement Corp (TCC, 台灣水泥). Both TTS and TCC belong to TCC International Holdings Ltd (台泥國際集團). With the electric tractor unit, the Taipei-based cement firm would become the first in Taiwan to use electric vehicles to transport construction materials. TTS chairman Koo Kung-yi (辜公怡), Volvo Trucks vice president of sales and marketing Johan Selven, TCC president Roman Cheng (程耀輝) and Taikoo Motors Group
Among the rows of vibrators, rubber torsos and leather harnesses at a Chinese sex toys exhibition in Shanghai this weekend, the beginnings of an artificial intelligence (AI)-driven shift in the industry quietly pulsed. China manufactures about 70 percent of the world’s sex toys, most of it the “hardware” on display at the fair — whether that be technicolor tentacled dildos or hyper-realistic personalized silicone dolls. Yet smart toys have been rising in popularity for some time. Many major European and US brands already offer tech-enhanced products that can enable long-distance love, monitor well-being and even bring people one step closer to
RECORD-BREAKING: TSMC’s net profit last quarter beat market expectations by expanding 8.9% and it was the best first-quarter profit in the chipmaker’s history Taiwan Semiconductor Manufacturing Co (TSMC, 台積電), which counts Nvidia Corp as a key customer, yesterday said that artificial intelligence (AI) server chip revenue is set to more than double this year from last year amid rising demand. The chipmaker expects the growth momentum to continue in the next five years with an annual compound growth rate of 50 percent, TSMC chief executive officer C.C. Wei (魏哲家) told investors yesterday. By 2028, AI chips’ contribution to revenue would climb to about 20 percent from a percentage in the low teens, Wei said. “Almost all the AI innovators are working with TSMC to address the
Malaysia’s leader yesterday announced plans to build a massive semiconductor design park, aiming to boost the Southeast Asian nation’s role in the global chip industry. A prominent player in the semiconductor industry for decades, Malaysia accounts for an estimated 13 percent of global back-end manufacturing, according to German tech giant Bosch. Now it wants to go beyond production and emerge as a chip design powerhouse too, Malaysian Prime Minister Anwar Ibrahim said. “I am pleased to announce the largest IC (integrated circuit) Design Park in Southeast Asia, that will house world-class anchor tenants and collaborate with global companies such as Arm [Holdings PLC],”