U.S. Crude Ends at Four-Month High
NYMEX-traded crude futures settled at a four-month high on Wednesday, after Chinese data showed record oil imports for January and key oil producers raised their forecast on global demand growth for the year. However, a larger-than-expected build in domestic crude supplies in the week ended February 7 kept the gains in check. The U.S. Energy Information Administration (EIA) said oil stockpiles rose 3.3 million barrels last week – surpassing analyst forecasts for a 2.5 million-barrel build. Meanwhile, OPEC said in a monthly report that world oil demand in 2014 would grow at a slightly faster pace than previously expected. The group now sees growth of roughly 1.09 million barrels per day – up about 45,000 b/d from a previous forecast with demand see at 90.98 million b/d for the year. West Texas Intermediate (WTI) for March delivery ended 43¢ higher at US$99.94 per barrel (/bbl), after trading as high as $101.38/bbl. In European trading, Brent closed moderately higher, pressured as traders sold the European benchmark and bought WTI after the EIA update was released. Brent drew additional support from a stronger 2014 oil-demand forecast from OPEC and Chinese data released late Tuesday that showed oil imports hit record highs in January. Front-month March Brent finished up 11¢ at $108.79/bbl, widening Brent’s premium to WTI to $8.85/bbl, from $8.74/bbl in the previous session. With the March Brent expiring at the end of floor trading today, the more actively-traded April futures contract settled at $108.35/bbl, up 17¢.

Natural Gas Futures Log Modest Gains
U.S. natural gas futures settled slightly higher ahead of a weekly inventory report expected to show another larger-than-normal withdrawal from already spent storage facilities. Cold, wintry weather is forecast in the East and South over the next five days before much of the country warms over the next week or two. NYMEX-traded gas for March delivery tacked on 0.2¢ to close at US$4.822 per million British thermal units (/mmBtu). Natural gas futures are up about 14% since the start of the year, prices are still down 3% since early February. The contract tested resistance at $5, trading as high as $5.02/mmBtu in after-hours electronic trade on Tuesday, before slipping back to $4.78/mmBtu early Wednesday. Cash prices for natural gas eased, but remain high across the country. At Henry Hub, the benchmark supply point in Louisiana, gas for Thursday delivery fell $1.56 to $6.17/mmBtu, on average. Late-trade differentials were at a $1.22 premium to the NYMEX, slipping from a $1.41 premium earlier in the day. In New York, next-day prices on the Transco Zone 6 pipeline lost $13.87 to average $7.70/mmBtu in ICE trade. Elsewhere, early consensus estimates for the week ended February 7 predict a drawdown in natural gas stockpiles of between 197 billion cubic feet (Bcf) and 270 Bcf – well above the year-ago and five-year averages for that week.