NYMEX January RBOB fell sharply Monday, putting downward pressure on the oil complex, while ICE Brent broke below a key support level to trade at its lowest level since 2004.
NYMEX January RBOB settled 6.52 cents lower at $1.2094/gal. NYMEX January ULSD was almost unchanged, settling down 67 points at $1.1004/gal.
NYMEX January crude settled 1 cent higher at $34.74/b on expiry. February crude settled 25 cents lower at $35.81/b.
ICE February Brent settled 53 cents lower at $36.35/b. Front-month ICE Brent sunk to $36.04/b at one point, crossing below $36.20/b, which marked the low point during the 2008/09 global financial crisis.
ICE Brent setting an 11-year low was significant because it showed prices have further room to fall, CHS Hedging analyst Tony Headrick said.
"From a technical point of view throughout the complex I'm not positioned to call this a bottom," he said.
News reports about a postponed refinery strike in Belgium helped drive RBOB's decline, analysts said.
ExxonMobil's 320,000 b/d refinery in Antwerp, Belgium was running at normal rates Monday after a labor strike was postponed, according to a local media report. ExxonMobil was not immediately available for comment.
An expectation that refiners will increase gasoline production to capture solid margins contributed to RBOB's decline, Price Futures Group analyst Phil Flynn said.
"RBOB had been holding up pretty well," he said, but now appeared to be falling alongside other oil futures.
The front-month RBOB crack, basis ICE Brent, was trading around $14.65/b Monday afternoon, down from Friday's settle at $16.46/b. Last week the crack exceeded $17/b at one point for the first time since the summer.
Signs of increased US drilling activity have weighed on prices since Friday, analysts said.
The weekly US oil rig count rose by 17 Friday to 541 rigs, Baker Hughes said. It was only the second weekly increase since September, but also marked the largest rise in the number of active US oil rigs since the week that ended July 24.
In the Middle East, Saudi Arabia exported an average of 7.364 million b/d of crude in October, up 253,000 b/d from 7.111 million b/d in September, according to statistics released Sunday by the Joint Organizations Data Initiative (JODI).
JODI is a transparency initiative linked to the Riyadh-headquartered International Energy Forum.
