An 11-year high in the US dollar against other major currencies, and fears of fresh instability in the eurozone after a decisive Greek election victory by the Syriza party also limited any potential rebound in oil, traders said.
Light snow began falling on the US east Coast yesterday morning, the first signs of a potentially historic blizzard that officials predicted could dump up to three feet of snow in the coming day, snarling transportation for millions of people.
The US’ National Weather Service (NWS) issued a blizzard warning for New York City and surrounding areas between coastal New Jersey and Connecticut, beginning lunchtime yesterday and worsening overnight into this morning. It warned of two days of winter storms across the East Coast, from Pennsylvania to Maine.
“Crude is getting some help from supportive heating oil ahead of the blizzard, although with all the flight cancellations, it might end up being a bearish event on oil demand,” said Phil Flynn, analyst at Chicago’s Price Futures Group.
Traders said crude was pressured somewhat by Friday’s news that no time set for restarting a 90,000-barrel-per-day (bpd) crude distillation unit at BP’s 413,500-bpd refinery in Whiting, Indiana. The unit was shut a day earlier for unplanned repairs, sources said.
Saudi Arabia’s new king Salman pledged continuity in energy and foreign policies on Friday and was quick to retain veteran oil minister Ali al-Naimi, in a message aimed at calming a jittery oil market.
The Saudis were pivotal to OPEC’s decision in November not to cut oil exports in order to preserve their market share amid a global supply glut that has more than halved prices since June.
In yesterday’s early trade, Brent and US crude turned positive after Abdullah al-Badri, secretary-general of the Organisation of the Petroleum Exporting Countries (OPEC), said he thought prices may have reached their bottom. But the market slipped soon after.
US crude was up 10c at $45.69 a barrel at one point, yesterday, having falling to $44.35 earlier. Brent crude slipped 13 cents, or 0.3%, to $48.66 after a session low at $47.57.