OIL PRICES UP & DOWN
West Texas Intermediate and Brent crudes advanced after U.S. employment gains exceeded 200,000 for a ninth month and the jobless rate fell to a six-year low, bolstering the outlook for fuel demand.
Futures rose as much as 1.6 percent in New York and 1.2 percent in London. Payrolls increased by 214,000 in October following a 256,000 gain the prior month that was more than initially estimated, Labor Department figures showed today. The unemployment rate declined to 5.8 percent. Both oils are heading for weekly declines after OPEC predicted it will need to supply less crude amid the U.S. shale boom.
"The market is concentrating on the jobs numbers," Bob Yawger, director of the futures division at Mizuho Securities USA Inc. in New York, said by phone. "The unemployment rate dropped to 5.8 percent even as the labor force expanded, which implies that more people will be consuming goods and driving. This is all good for demand."
WTI for December delivery rose $1.05, or 1.4 percent, to $78.96 a barrel at 9:40 a.m. on the New York Mercantile Exchange. Prices are down 2 percent this week and 20 percent this year. The volume of all futures traded was 6 percent below the 100-day average for the time of day.
Brent for December settlement gained 85 cents, or 1 percent, to $83.71 a barrel on the London-based ICE Futures Europe exchange. Volume was 7.1 percent lower than the 100-day average. Prices have fallen 24 percent in 2014. The European benchmark crude traded at a $4.70 premium to WTI, compared with $4.95 at yesterday's close.
Oil has slumped into a bear market amid signs that global supply growth is outpacing consumption. Leading OPEC members have resisted calls to cut output even as a surplus develops amid the shale boom in the U.S., which is pumping at the fastest pace in more than 30 years.
The Organization of Petroleum Exporting Countries reduced every forecast for demand for its crude through 2035 except next year's, according to the group's annual World Oil Outlook, released yesterday. Demand for the group's crude may fall to a 14-year low of 28.2 million barrels a day in 2017, its outlook showed. That's 600,000 a day less than last year's projection and 800,000 below the amount required this year.
Oil will rebound by the second half of next year as supply and demand don't justify the market's collapse and prices are low enough to threaten investment in production, according to OPEC Secretary-General Abdalla El-Badri. The 12-member group, scheduled to meet Nov. 27 in Vienna, is "concerned but not panicking," he said yesterday.
In Libya, where output gains have contributed to rising supply from OPEC, the Sharara field will resume production "soon," said Mansur Abdallah, director of oil movement at the Zawiya refinery and port yesterday. It was pumping 290,000 barrels a day before being shut as a precaution when gunmen stormed the facility.
U.S. crude production expanded to 8.97 million barrels a day through Oct. 31, the Energy Information Administration said on Nov. 5. That's the most in weekly data going back to January 1983, according to the Energy Department's statistical arm.
WTI may climb next week, a Bloomberg News survey shows. Sixteen of 34 analysts and traders, or 47 percent, estimated futures will increase through Nov. 14, while nine respondents predict a price decline.
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WNA - Apart from adding capacity, utilisation of existing plants has improved markedly since 2000. In the 1990s capacity factors averaged around 60%, but they have steadily improved since and in 2010, 2011 and 2014 were above 81%. Balakovo was the best plant in 2011 with 92.5%, and again in 2014 with 85.1%.
WNA - India has a flourishing and largely indigenous nuclear power programme and expects to have 14.6 GWe nuclear capacity on line by 2024 and 63 GWe by 2032. It aims to supply 25% of electricity from nuclear power by 2050.
WNA - Mainland China has 38 nuclear power reactors in operation, about 20 under construction, and more about to start construction. The reactors under construction include some of the world's most advanced, to give a 70% increase of nuclear capacity to 58 GWe by 2020-21. Plans are for up to 150 GWe by 2030, and much more by 2050.
PLATTS - "The domestic uranium mining industry needs US government assistance to survive the foreign onslaught -- particularly from Russia and Kazakhstan -- that has undermined the US uranium industry while new players -- particularly China -- will soon make the situation worse," Energy Fuels and Ur-Energy said in a petition they jointly filed with the department.