Commodities

Oil and natural gas daily review (May 21, 2012)

Contributed by Nirmal Bang

MARKET ROUNDUP

Crude oil fell more than 1 percent on Friday, down for the sixth straight session, as worsening problems in Greece and Spain raised worries of contagion in the euro zone.

IN FOCUS

- U.S. crude oil demand dipped slightly in April as gasoline consumption posted a small gain for the month, the American Petroleum Institute said on Friday.

- The Seaway pipeline began pumping crude from Cushing, Oklahoma, oil tanks to the heart of the U.S. refining industry in Houston on Saturday, marking a historic  shift in the way oil flows across the United States.

- Colombia said on Friday it would send 50 percent more natural gas this year to neighboring Venezuela, which has yet to start producing the fuel commercially despite huge reserves.

- Hedge funds and big speculators cut their bullish crude oil bets to the lowest level since late 2010, but the pace of liquidation slowed after their biggest bearish turn, regulatory data showed on Friday.

- China's gasoline exports stood at 140,000 tonnes in April and outbound shipments in the first four months declined 36.4 percent from a year earlier to 1.15 million tonnes, data from the China Customs Statistics Information Centre (CCS) showed on Monday.

- Russia is not concerned about the current selloff in oil markets as crude prices remain above the level at which its budget is calculated, Deputy Finance Minister Sergei Storchak said on Saturday.

- Bangladesh has struck its first oil, in two gas fields in the northeastern Sylhet region, the chairman of the state-run Oil, Gas and Mineral Corporation (Petrobangla) said on Sunday.

FUNDAMENTAL OUTLOOK

Crude oil is trading lower on NYMEX today. We expect prices to trade lower on account of as concerns about the European economy continued to weigh on prices despite world leaders on the weekend pledging to combat financial turmoil.