February 7th, 2012

Heating oil futures surged to the highest level since May as colder weather in Europe boosted gasoil futures.

Heating oil futures gained as front-month gasoil’s premium to the second-month contract, a price structure known as backwardation, increased to the widest in almost a month amid colder weather in Europe that has increased demand for home-heating fuel.

“Because of the cold weather in Europe, the thought is that some of our heating oil would get displaced to Europe,” said Phil Flynn, vice president of research at PFGBest in Chicago.

Heating oil futures for March-delivery rose 2.36 cents, or 0.7 percent, to $3.1943 a gallon at 11:13 a.m. on the New York Mercantile Exchange. Prices touched $3.2208, the highest intraday level since May 3.

February gasoil rose $8 to $996.25 a metric ton on the ICE Futures Europe exchange in London. The contract traded at as much as $2.25 a metric ton more than March, the biggest spread since Jan. 12. The difference was $1 as of 11:14 a.m. in New York.

“You’ve probably got a squeeze going on over there with the cold weather,” said Fred Rigolini, vice president of Paramount Options Inc. in New York.

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January 26th, 2012

Heating oil futures and gasoline gained as the Federal Reserve indicated it will maintain near-zero interest rates to stimulate growth and refiners reduced output to cut supplies.

Heating oil futures rose after Fed officials said yesterday that the benchmark interest rate would stay low until at least 2014. Two refineries in Pennsylvania and one in the U.S. Virgin Islands have been closed because they weren’t profitable.

“The underlying reason products are up continues to be the worries of supplies going forward,” said Gene McGillian, an analyst and broker at Tradition Energy in Stamford, Connecticut. “And there’s the idea that oil prices are going to be supported by easy money.”

Heating oil futures for February-delivery rose 3.43 cents, or 1.1 percent, to settle at $3.0535 a gallon on the New York Mercantile Exchange, the highest settlement since Jan. 12. Gasoline for February delivery rose 1.28 cents, or 0.5 percent, to $2.8466.

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Heating Oil Prices At A Boil

On January 23, 2012, in heating oil futures news, by Infinity Trading

January 21st, 2012

Heating Oil Futures —  When David Harris built his 2,000-square-foot hilltop home nine years ago, he wanted to put in natural gas, but the utility wouldn’t run a line to his house. Like many people here, he was stuck using heating oil.

Harris added a wood stove to help cut costs and now uses only about one-third of the oil the house would otherwise need. But that did not stop a deliveryman for Crowley Fuel from handing him a $471.21 bill earlier this month for a refill that should get him to April.

”You just cross your fingers and hope that it doesn’t get too much worse,” Harris said.

Actually, it probably will – for him and the residents of the roughly 8 million other U.S. homes that use heating oil, mostly in a band from Maine to Pennsylvania.

While natural gas prices have plummeted to 10-year lows, heating oil prices have been steadily rising for years and are expected to reach record levels this winter, precipitated by higher costs for crude oil and the shutdown of several crucial refineries in the Northeast and in Europe. The Energy Department projects a price of $3.79 a gallon over the next few months, more than a dollar above the winter average for the last five years. Analysts do not expect much relief in the longer term, either, because global oil prices are expected to stay high amid political instability in the Middle East and rising demand from developing countries.

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December 29th, 2011

Heating oil futures rose as jobless claims slid to a three-year low over the past month and cooler weather was forecast for the U.S. Northeast in January.

Heating oil futures gained after Labor Department figures showed the four-week moving average for claims, a less volatile measure than the weekly figures, dropped to 375,000 last week, the lowest level since June 2008. The National Weather Service’s Climate Prediction Center forecast lower-than-normal temperatures Jan. 5-11 from Maine to Florida.

“Not only are we going to have a return of winter but the U.S. economy is improving and that should improve the demand for diesel and even gasoline,” said Phil Flynn, vice president of research at PFGBest in Chicago.

Heating oil futures for January-delivery rose 2.45 cents, or 0.9 percent, to $2.9179 a gallon at 1:09 p.m. on the Nymex. Prices are heading for a 15 percent gain in 2011.

In other indications of a strengthening economy, the Institute for Supply Management-Chicago Inc. said its business barometer (CHPMINDX) was little changed at 62.5 from a seven-month high of 62.6 a month earlier. The index of signed contracts (USPHTMOM) to buy previously owned houses increased 7.3 percent in November, the National Association of Realtors said.

Distillate stockpiles rose 1.21 million barrels (DOESDIG5) to 140.4 million in the week ended Dec. 23, the Energy Department reported today. Inventories of industrial, shipping and heating fuels are 13 percent below year-earlier levels.

Demand (DOEDDIST) for distillates fell 14 percent to 3.8 million barrels a day, the lowest level in four weeks. The four-week average consumption was 3.9 percent above a year earlier.

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December 5th, 2011

Heating oil futures were little changed after Italian Prime Minster Mario Monti proposed budget cuts and on a report that Standard & Poor’s will put France and Germany on “creditwatch negative.”

Heating oil futures rose earlier to a two-week high as Monti presented a 30 billion-euro ($40 billion) plan to policy makers in Rome. German Chancellor Angela Merkel and French President Nicolas Sarkozy pushed for a rewrite of the European Union’s governing rules to tighten economic cooperation. The Financial Times reported the credit ratings company would release a statement later today.

“I think the market might be a little skeptical that can get done,” said Phil Flynn, a senior market analyst at PFGBest in Chicago. The Standard & Poor’s downgrade report “is going to put downward pressure on the prices,” he said.

Heating oil futures for January delivery gained 0.24 cent to settle at $2.9924 a gallon on the New York Mercantile Exchange. The contract rose to $3.0807, the highest intraday price since Nov. 18, before retreating.

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November 29th, 2011

Heating oil futures and gasoline rose as a gain in retail sales increased confidence that the U.S. economy is strengthening and fuel demand will improve.

Heating oil futures advanced as U.S. sales at stores open at least a year rose 5.4 percent in the week ended Nov. 26 from a year earlier, according to Johnson Redbook Research. Consumer confidence climbed in November by the most since April 2003, according to a report from a private research group.

“The Redbook retail sales report is confirming what we’re seeing at the malls and it’s another sign the U.S. economy is doing well,” said Phil Flynn, vice president of research at PFGBest in Chicago.

Heating oil futures for December-delivery advanced 5.12 cents, or 1.7 percent, to settle at $3.0211 a gallon on the New York Mercantile Exchange. The more actively traded January contract rose 5.09 cents, or 1.7 percent, to $3.0336.

Gasoline for December delivery gained 2.1 cents, or 0.8 percent, to settle at $2.5391 a gallon on the exchange. The January contract advanced 2.21 cents, or 0.9 percent, to $2.5398.

December heating oil and gasoline contracts will expire at the end of floor trading tomorrow.

Heating oil’s premium to gasoline widened 3.02 cents to 48.2 cents on speculation inventories of diesel and heating oil declined to the lowest level in almost three years.

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November 16th, 2011

Heating oil futures fell as concern that Europe’s debt crisis will worsen intensified after the Bank of England said Britain faces “a markedly weaker” growth outlook.

Heating Oil futures sank as the euro and Brent crude oil weakened after Bank of England Governor Mervyn King said the country faces persistent danger from Europe’s fiscal crisis. Heating oil’s premium to gasoline narrowed.

“The concerns about Europe are bringing that spread in a little bit,” said Phil Flynn, vice president of research at PFGBest in Chicago.

Heating oil futures for December-delivery declined 4.65 cents, or 1.5 percent, to $3.1248 a gallon at 9:44 a.m. on the New York Mercantile Exchange, the largest decline since Oct. 19.

Heating oil’s premium over gasoline narrowed to 52.9 cents from 58.56 cents yesterday. The spread reached 62.69 cents on Nov. 14, the widest since November 2008.

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November 11th, 2011

Heating oil futures rose to a six-month high as Italy and Greece are poised to get new leadership and approve austerity measures, easing concern that Europe’s economic crisis will spread, threatening the global recovery.

Heating oil futures advanced as Italy’s Senate approved debt-reduction measures today as a precursor to a new government that may be led by former European Union Competition Commissioner Mario Monti. Lucas Papademos, a former vice president of the European Central Bank, will be sworn in a Greece’s prime minister today.

“People are encouraged about Italy and Greece, feeling this may help prevent a big slowdown in the European economy,” said Andy Lipow, president of Lipow Oil Associates LLC in Houston.

Heating oil futures for December-delivery rose 2.05 cents, or 0.7 percent, to settle at $3.1716 a gallon on the New York Mercantile Exchange, the highest settlement for the front-month contract since May 3. Futures increased 3.3 percent this week, the third consecutive weekly gain.

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