In the final month of 2009, the major crude oil benchmarks’ spot price came to roughly $75/barrel on average, almost twice the value from December 2008. Furthermore, in December 2009, the average LNG import price among EU countries reached $5.92/MBTU, the highest value since April 2009.
- Dubai
- Brent
- WTI
- 32
- 38
- 40
- 30,88
- 32,86
- 33,68
- 49,54
- 54,52
- 56,59
- 61,52
- 65,14
- 66,02
- 68,27
- 72,39
- 72,20
- 94,18
- 97,26
- 100,06
- 61,91
- 61,67
- 61,92
- 76,69
- 76,19
- 78,31
- 83,59
- 84,89
- 84,44
- 72,49
- 75,64
- 76,32
- 75,12
- 77,79
- 75,17
- 87,41
- 89,95
- 88,40
During 2010's initial quarter, harsh meteorological conditions sent the price of crude oil soaring. Thus, both WTI in the US market and Brent in London reached prices over $84 per barrel mid-way through April, levels unprecedented since October 2008. However, this increase was partly due to the dollar's weak performance against the euro.
The OPEC also issued an upward revision of the yearly demand, thanks to the revamped US, Chinese and Middle Eastern economies.
In mid March, during its 156th conference, the OPEC agreed to maintain official production levels as they were on 1 January 2009. This figure, 24.8 million barrels per day, has, in all reality, been exceeded.
The second four months was characterised by a drop in oil prices. Spot contracts closed in mid May for the subsequent months valued Brent and WTI at just over $70/barrel. Mid-way through August, WTI was valued at $78/barrel on the spot market, while Brent came to $76.4/barrel.
The 9th International Oil Summit in Paris expressed concerns over the volatility of market prices. To defend prices fluctuating between $70 and $80/barrel, producing countries’ upheld the need to finance sizeable investments to replace crude oil reserves.
In June, the IEA decreed that eliminating energy consumption subsidies would reduce the worldwide demand by 5.8%. Said subsidies are primarily assigned to emerging countries, such as China and India, and producers, like Russia, Saudi Arabia and Iran.
Crude oil prices remained volatile over the third four-month period. However, activity in this quarter evidenced an upward trend.
Mid-way through October, the IEA, as part of its monthly report, issued an upward revision of the worldwide oil demand for 2010 and 2011, which rose to 86.9 and 88.2 million barrels per day, respectively.
The OPEC, around these same dates, during its 157th ministerial conference, decided to maintain the production quota at 24.8 million barrels per day. An agreement was reached during the mid-December meeting held in Quito, which stipulated that the 24.84 million b/d quota, in effect since December 2008, would not be modified.
During this same period, the price of crude oil oscillated between $88 and $90/barrel, with a weak American dollar. Within this context, the price of oil-based products climbed to figures approaching the maximum recorded quota of $140/barrel. Some experts felt this situation could have dire repercussions on economic recovery.
The upward trend evidenced in the year’s closing weeks carried over into 2011. Over the course of the year, the OPEC’s average price of a barrel of crude oil climbed by almost 18%.
Natural gas prices fluctuated during 2010’s initial four months with a downward trend, starting the year at an average value of roughly $6/MMBTU. From April onward, the price in the New York (NYMEX) Stock Exchange remained firmly above $4/MMBTU, with a slight but sustained upward trend. The gap between European and US market prices increased notably in the former’s favour, with differences, in certain cases, of more than $3 per million BTU.
At year’s end, the market price in the NIMEX finished at $4.44/MMBTU (12.12.10) for January 2011. In the US spot market, the Henry Hub came to $4.52/MMBTU. Respective values during the initial weeks of 2011 were more or less the same.
As had previously occurred in 2009, natural gas prices followed the price of crude oil’s deindexication trend in 2010, more acute in certain markets than in others. This proves evident in the US. In Europe and other regions around the world, both new and renewed contracts have a tendency to index prices with joint benchmarks, partly based on oil-based product prices and/or coal prices and partly on the spot market price.
