Oil Prices Jump for The Fourth Day in A Row

On Thursday, oil prices rose for a fourth straight day and reached their highest level in two and a half weeks as U.S. crude, heating oil, and jet fuel supplies became more scarce as a wintry blast hit the country.

Brent crude futures were trading at $83.37, up $1.17, or 1.4%, from the previous session’s close.

WTI crude for the United States was trading at $79.40 per barrel, up $1.11 or 1.4%.

After government data showed that U.S. crude inventories decreased by 5.89 million barrels for the week ending on December 16, much more than analysts had anticipated, both benchmark contracts increased on Wednesday. The demand for heating oil should soar as a strong winter storm hits the United States. Florida and the eastern states are expected to experience record-breaking low temperatures, and Texas is expected to experience wind chills below zero.

Jet fuel consumption is also anticipated to increase with a post-COVID surge in travel for the holiday season. However, the demand for transportation fuel may decline if the storm prevents people from traveling.

U.S. Power and Gas Prices Soar

As a result of the extreme cold and snow that has blanketed much of the nation, freezing oil and gas wells, and pipeline problems that prevent gas from flowing into California, U.S. power and gas prices in the Midwest.

The gas output should drop by about 4.722 billion cubic feet per day (bcfd) over the past three days to a preliminary seven-month low of 94.33 bcfd on Thursday as freezing weather blankets much of the country and causes wells to freeze in Texas, North Dakota, Pennsylvania, and other places.

That would be the biggest daily output decline since February 20, 2021, when Winter Storm Uri cut off Texas’ gas supplies and compelled the state’s electric grid operator to impose rolling power outages.

One billion cubic feet of gas daily could power Five million homes in the United States.

The price of gasoline for the following day on Thursday at the PG&E Citygate NG-CG-PGE-SNL in Northern California soared to a record high of $56 per million British thermal units, breaking the previous record of $53 set in December 2000.

Since reaching a 22-month high of $50 last week, gas at the Southern California (SoCal) Border NG-SCL-CGT-SNL has increased to $48 per mmBtu, its highest price.

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