The International Energy Agency (IEA) in Paris revised downwards its annual global consumption estimates, and the news from the world's largest oil consuming economy continued to disappoint. ( Gulf )
But oil markets were underwhelmed as they kept their focus on the long-term future prospects for crude to guide nearby contract valuations; and the future is decidedly bullish.
Traders know that the IEA and similar agencies fail to consider the fear factor in oil prices, which is estimated to be as high as $18-$24 a barrel.
With the world holding its collective breath in anticipation of more warnings from Washington regarding Iran, and with new nationalisation rumblings in Russian oil and gas fields, crude markets had little incentive to retrench, with Nymex WTI ending up $3.91 for the week, at $110.14.
ICE Brent also ended up $3.85 at $108.75. The Opec basket gained $6.37 for the week ending at $103.74, and the DME Oman gained $5.75 to close out the week at $103, giving further cursory evidence of increasing price leadership by the heavy sours in benchmarking the world's crude streams.
Some energy pundits blamed crude's price gains for the week on the falling dollar against the euro. But while hitting new lows, the dollar only fell by about 1.2 per cent, while regional crude prices increased by over six per cent, forcing us to look elsewhere to understand crude price behaviour.
Long run bullishness appears to be increasingly influential on current prices: a worsening geopolitical climate north of the Persian Gulf, unencumbered China demand, and potentially serious supply difficulties beginning to emerge in Russia, the world's second largest oil exporter - all this is causing crude prices to solidify at levels high relative to current daily oil demand and supply realities.
The benchmark Nymex natural gas closed the week at $10.89 per million btu, an increase of $1.57 or about 17 per cent, up on continued colder weather in the US northeast and in anticipation of more demand to come as communities block new coal-powered plant construction to cover energy demand increases.
Net short options and futures in natural gas were slightly reduced for the week, signalling that traders are expecting prices to firm up at current levels.
Local gas markets continued to hear of tightening supplies likely near term. Available regional export gas is mostly already spoken for, making anticipated energy demand increases harder to cover.
Qatar's recent announcement of a moratorium on any new export contracts and Iranian geopolitical uncertainties can only add upward pressure on regional gas contract prices.