U.S. Crude Remains Near Four-Month High
NYMEX-traded crude futures topped US$103 per barrel (/bbl) on Wednesday – reaching a new four-month high with forecasts for another cold snap next week is expected to increase demand.
The wintry weather outlooks also sent heating oil prices soaring to near-three-week highs heading into the close. West Texas Intermediate (WTI) for March delivery, which expires at the end of floor trading today tacked on 88¢ to settle at $103.31/bbl. On the session, the U.S. benchmark traded as high as $103.65/bbl – its highest since October 9. The more actively-traded April WTI contract ended 74¢ higher at $102.84/bbl. The April WTI premium to May U.S. crude widened by as much as 26¢ to an intra-day high of $1.15/bbl. The backwardated spread settled at a five-month high at $1.03/bbl. Across the Atlantic, London-traded Brent crude oil ended the day flat as traders weighed concerns of tighter global supply that could be triggered if the violent protests in Venezuela exacerbate already reduced output from Libya and South Sudan. Supply remains disrupted in Africa. Libyan production averaged 375,000 barrels on Wednesday as protests continued to hamper flows from the key oilfield, El Sharara, according to state oil company reports. Front-month April Brent finished up a penny at $110.47/bbl – reversing a rally on February 18 in which it rose to the highest level this year to-date.

Natural Gas Futures Ends Above $6/mmBtu
U.S. natural gas futures sprinted past US$6 per million British thermal units (/mmBtu) on Wednesday to their highest price in more than five years. Prices finished up nearly 11% as the latest U.S. weather forecasts predicted more severe cold, fueling worries about already tight supplies. A storage update due out today is expected to show a record fourth-straight weekly drop in excess of 200 billion cubic feet of gas. Persistently cold weather across the United States in January and February has reduced stocks of natural gas to 34% below 2013 levels and 27% below the five-year average. As prices advanced early in the session, traders bought futures contracts to cover short positions, and speculative money poured into the market – further advancing the rally, market observers said. NYMEX-traded gas for March delivery settled up 59.8¢ at $6.149/mmBtu, after jumping as much as 72.4¢, or 13%, to $6.275/mmBtu – the highest since December 2008. After a brief warm-up this week, forecasters expect frigid weather at the end of February and into March. Unseasonably cold temperatures are expected in the six-to-10-day outlook – not only throughout the Midcontinent, but well into the South and East.