Crude Oil Hits $100/bbl

History was made on February 19, 2008 as NYMEX Crude Oil closed above $100 per barrel for the first time in history. While crude oil futures had traded above $100/bbl twice before earlier in this year, today marked the first day the futures contract actually closed the day above the $100/bbl mark. The front-month (March '08) contract for west Texas light crude oil was up $4.51 to close at $100.01 per barrel.

OPEC To Cut Production?

Today's run-up came after comments by the Iranian oil minister suggesting it was normal for OPEC to cut production in March, as US demand shrinks as the winter heating season comes to an end. Springtime and fall are known as "shoulder seasons" in the industry - oil demand shrinks as heating / cooling demand is down and the summer driving season is either yet to come or just over. Traders also took the explosion and fire at the Big Spring refinery in Texas as a buying signal, contributing to today's price spike.

Oil Price To Drop

Meanwhile, in after-hours trading, the price of oil fell by as much as 90 cents to $99.11/bbl as traders locked in profits and speculated that the US inventory numbers, due to be released Thursday this week, will show stockpiles are up. Many analysts are suggesting the price of oil will retreat to the mid $80 level in the coming months as demand moderates in the slower shoulder months.

Resource Stocks Trade Higher

On the Canadian markets today, most resource stocks traded higher. Suncor closed at $99.59/share, while Encana shares got a boost as natural gas futures shot up to just under $9 per Gigajoule, the highest level seen since June 2007. South of the border, Exxon-Mobil closed up $1.64/share at $87.01, while Chevron Corp was up $1.23/share to close at $84.83.

Jim Sparrow sells Calgary Real Estate with Keller Williams Platinum Realty & specializes in South Calgary estate and luxury homes. Visit our website at Calgary Luxury Real Estate or contact me directly at 403.703.2404

• Exxon Up
• Encana Up As Natural Gas Hits $9/GJ
• Suncor Trades Up
• Chevron Closes Higher

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