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Oil and Natural Gas Futures Diverge Under Shadow of Government Shutdown

By  +Follow October 1, 2013 11:43AM
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While stocks bravely rallied in the face of the shutdown of the US government that began on Tuesday, oil and natural gas prices diverged.

West Texas Crude contracts for November delivery were down 1.10 percent to $101.20 per barrel, while the same contracts for Brent crude dipped 1.22 percent to $107.05 per barrel.

Meanwhile, natural gas contracts destined for a delivery date of November 13 were up nearly 2 percent to $3.63 per million BTUs on the New York Mercantile Exchange.

Crude prices have come down as a result of several factors. Against the backdrop of the 3-year old civil war in Syria that continues to rage, US Secretary of State John Kerry met with the Iranian Foreign Minister on the sidelines of the UN General Assembly meeting in New York City last week, in the highest-level diplomatic contact between the two countries since the revolution of 1979.

It was a stark and sudden contrast to US threats of military strikes against Syria, a close ally of Iran, that seemed a near certainty not three weeks ago. The apparent willingness of all parties to resort to dialogue rather than increased hostilities has eased concerns of supply disruption in the region.

The recent resumption of Libyan oil production, much of which had been brought to a standstill for extended periods by the country’s many unruly revolution-era militias, has also contributed to the downward pressure on crude prices.

The current impasse in Washington, D.C. over the continued functioning of the federal government, and the expected impasse over the debt ceiling over the coming weeks has also played its part in lower oil prices.

Natural gas, on the other hand, has been the beneficiary of recent bullishness around independent producers in the US. Last week, Goldman Sachs (GS) analysts returned from a visit to the Bakken Shale, and initiated coverage on Continental Resources (CLR) and Oasis Petroleum (OAS) . Both stocks jumped in reaction to the news, and were also up on Tuesday, 3.6 and 2.4 respectively.

Goldman Analysts were particularly enthusiastic about independent gas producers operating not only in the Bakken Shale, but also in the US’s many other shale prospects such as the Marcellus that lies underneath large swathes of the Northeastern portion of the country.

[Image Courtesy of Wikimedia Commons]

DISCLOSURE: The views and opinions expressed in this article are those of the authors, and do not represent the views of equities.com. Readers should not consider statements made by the author as formal recommendations and should consult their financial advisor before making any investment decisions.


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Results for gs
Perry Senjem
23 Aug 14 04:09:00
RT @rcwhalen: FHFA Announces Settlement with Goldman Sachs | $GS | http://t.co/wOJI8uU7tR | Gotta love Fridays in August...
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23 Aug 14 03:43:40
FHFA Announces Settlement with Goldman Sachs | $GS | http://t.co/wOJI8uU7tR | Gotta love Fridays in August...
ubiquitous.pro
23 Aug 14 03:36:31
RT @ForTraders: FHFA Announces Settlement with Goldman Sachs http://t.co/rbfG0HqB63 $FNMA $FMCC $GS
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23 Aug 14 03:28:50
RT @ForTraders: FHFA Announces Settlement with Goldman Sachs http://t.co/rbfG0HqB63 $FNMA $FMCC $GS
4-traders.com
23 Aug 14 03:25:03
FHFA Announces Settlement with Goldman Sachs http://t.co/rbfG0HqB63 $FNMA $FMCC $GS
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$GS: Goldman Sachs, U.S. agency in mortgage settlement worth $1.2 billion http://t.co/hECWd1rSQZ http://t.co/pIsQ6hdPnt
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Javier Jiménez Leube
23 Aug 14 02:43:47
RT @GoldmanSachs: Congrats to the $GS 2014 @GirlsWhoCode Summer Immersion Program graduating class! #GirlsBuiltThis http://t.co/4DwTyTybsp
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$GS: [$$] Goldman Sachs Partners Cut Combined Ownership Stake to 8.52% http://t.co/b6rjcsCLyn http://t.co/iO6XsfcrLD
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#GoldmanSachs $GS To Shell Out $3.15B In Settlement Over Mortgage Bonds http://t.co/wqY2De9r2f
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RT @Biz_News_Now: $GS: [video] Goldman Sachs to Buy Back $3.15B in Mortgage Securities http://t.co/rccOepDaNS http://t.co/NkJDdUWCDL
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$GS: [video] Goldman Sachs to Buy Back $3.15B in Mortgage Securities http://t.co/rccOepDaNS http://t.co/NkJDdUWCDL
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Umesh Desai  巫瑪仕
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#GoldmanSachs settles FHFA lawsuit for about $1.2 billion $GS http://t.co/Fl4ZDvLZJX
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$GS: Goldman Sachs Partners' Ownership at Lowest Since 2010 http://t.co/Ym82Pdjqbl http://t.co/L9cOaXTbZo
xifu
22 Aug 14 21:21:32
18 months later i sold those us financial stocks $BAC $C $GS $AIG $BRK-B for a 50% gain..
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$XLF Weekly chart sending a clear signal, with a new 52 week high. $GS $JPM $MS $BAC $C $WFC http://t.co/4IvOsAH2xb
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Replicate multimillionaire strategy easy to copy! Subscription is cheap at twice the price! http://t.co/Ho9ydXHTWl $C $GS $YHOO $AOL $GTAT
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22 Aug 14 18:30:16
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Sabrina
22 Aug 14 18:05:54
RT @GoldmanSachs: Congrats to the $GS 2014 @GirlsWhoCode Summer Immersion Program graduating class! #GirlsBuiltThis http://t.co/4DwTyTybsp
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$CRM $INTC $BAC $EJ $DYN $MSFT $GS $FL $FINL these started to trend a week after I tweeted about them. See trends before they are trends.
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22 Aug 14 17:50:39
RT @GoldmanSachs: #Inventor Dean Kamen talks #technology w/ $GS employees, incl. one who uses his iBot powered wheelchair #TalksAtGS http:/…
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22 Aug 14 17:41:00
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22 Aug 14 16:47:47
Replicate multimillionaire strategy easy to copy! Subscription is cheap at twice the price! http://t.co/Q6vtkuSPbk $C $GS $YHOO $AOL $GTAT
4-traders.com
22 Aug 14 16:35:01
Goldman Sachs : 22 Aug 2014 Goldman Sachs Announces Agreements with FHFA http://t.co/RgaaBUgIcX $GS
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22 Aug 14 16:31:44
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22 Aug 14 16:26:24
RT @GoldmanSachs: Congrats to the $GS 2014 @GirlsWhoCode Summer Immersion Program graduating class! #GirlsBuiltThis http://t.co/4DwTyTybsp
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22 Aug 14 15:24:15
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22 Aug 14 15:22:42
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22 Aug 14 15:04:14
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22 Aug 14 15:00:02
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See why these assets are trending in 1 watchlist $FB $GS Dow Jones $Nasdaq $SPX http://t.co/JfRnE0WLJY
Andrew
22 Aug 14 14:50:21
RT @theflynews: $GS $FNMA $FMCC Goldman Sachs announces agreements with FHFA to repurchase $3.15B in RMBS: Full Story http://t.co/G5XEjVeoVf
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22 Aug 14 14:40:58
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Timothy Connolly CFA
22 Aug 14 14:35:23
Huzzah!!! RT @GoldmanSachs $GS has reached agreements with the FHFA to resolve legal claims on RMBS. http://t.co/qvS8SlqYeb
CJ Mandarin
22 Aug 14 14:35:17
RT @SconsetCapital: Fine. "@BloombergNews BREAKING: $GS agrees to buy back $3.15 billion of mortgage securities to end government probe: h…
Timothy Connolly CFA
22 Aug 14 14:33:51
Fine. "@BloombergNews BREAKING: $GS agrees to buy back $3.15 billion of mortgage securities to end government probe: http://t.co/O6XTGoFCJe
Media Sentiment
22 Aug 14 14:30:03
$GS received a new alert. Find out why at http://t.co/5udYd0Ofs6 #stocks #daytrading #trading #mkt #NYSE #NASDAQ #markets 329
MarketCurrents
22 Aug 14 14:28:47
Goldman settles with FHFA, will buy back RMBS for $3.15B http://t.co/ybXTAC0zxD $GS
				
				
By  +Follow October 1, 2013 11:43AM
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