Strength of gasoline futures lift energy market
HERBERT G. McCANN
Sep. 02, 1997
Energy futures prices were higher Tuesday on the New York Mercantile Exchange, led by a strong rally in gasoline futures as extended problems at an Exxon refinery raised concerns about supplies.
On other markets; copper futures prices were lower due to lagging demand and coffee futures prices gained on a possible strike by Brazilian dock workers.
Gasoline futures gained as Exxon continued to service a key refinery unit at Baytown, Texas. The unit, which has been out of commission for unscheduled maintenance since early August, produces 396,000 barrels of gasoline a day.
There had been reports Exxon would attempt to restart the unit over the weekend. However, Exxon said the unit was still out of service with no date for a startup set.
The strength of gasoline lifted crude oil futures prices despite concerns over a return of Iraqi oil to the market.
The United Nations later this week is expected to approve the sale of Iraqi oil under the oil-for-aid agreement. Iraq was to have sold about $1.07 billion in oil by Sept. 5. However, the government, for unknown reasons, held back the sale of $478 million worth of oil.
It had been expected the United States and the United Kingdom would oppose giving Iraq another 90 days to sell oil. However, both countries have indicated they will agree to a sale.
Natural gas futures were higher on fears storage levels may come up short this winter.
Light sweet crude for October delivery was 4 cents higher at $19.65 a barrel; October heating oil was .18 cent higher at 53.40 cents a gallon; October unleaded gasoline was 1.57 cents higher at 62.79 cents a gallon; October natural gas was 7.9 cents higher at $2.793 per 1,000 cubic feet.
On other markets; Copper futures were lower on New York's Commodity Exchange, pressured by another rise in stocks at London Metal Exchange warehouses.
LME copper warehouse stocks were up Tuesday by 1,025 metric tons to 279,625 metric tons following a 3,450 metric ton rise on Monday. Stocks at COMEX copper warehouse has reached 46,499 metric tons.
Analysts say expectations are that demand for copper, heavily used in plumbing pipes and household appliances, will not recover from the slowdown in summer demand anytime soon.
There also has been an absence from the market of Chinese buyers, usually major factors on the copper market.
October copper was 3.40 cents lower at 96.30 cents a pound.
The possibility that Brazilian port workers will strike next week gave a boost to coffee futures prices on New York's Coffee, Sugar and Cocoa Exchange.
Brazil's coffee crop is about 90 percent harvested. If a strike is called, there is enough coffee at the nation's ports to pose a problem
The Santos port workers' union voted last week to strike Sept. 9 if the Santos Port Authority fail to meet their demands.
Also boosting coffee prices are fears dry conditions in Indonesia pose a threat to that nation's crop.
December coffee settled 5.05 cents lower at $1.962 a pound.