Prices for oil benchmark grades are falling on Monday after they finished “in the plus” for the fifth week in a row and reached the highest levels since mid-April.
The price of WTI crude oil futures for September at the electronic trading of the New York Mercantile Exchange (NYMEX) as of 8:16 a.m. Q2 is down $0.36 (0.45%) to $80.22 per barrel. At the end of the previous session they rose by $0.49 – to $80.58 per barrel.
Quotes of September futures for Brent crude oil on the London exchange ICE Futures is $84.4 per barrel, which is $0.59 (0.7%) below the closing price of the last session. On Friday, these contracts rose by $0.75 (by 0.9%) – to $84.99 per barrel.
Over the past week, quotes of Brent increased by 4.8%, WTI – by 4.6%, according to MarketWatch.
Since the beginning of July, the price of Brent has jumped by 12%, WTI – by 14%, which is the best monthly increase since January 2022, amid production cuts by Saudi Arabia and Russia, notes Trading Economics.
Analysts at ANZ Bank believe that strong macroeconomic data, including US GDP growth, will support oil prices in the near term.
Oil prices are falling on Wednesday after climbing the previous day to highs since mid-April.
The market’s decline on Wednesday is supported by data from the American Petroleum Institute (API), which showed an increase in U.S. inventories last week. Reserves rose by 1.319 million barrels after declining by 797,000 barrels a week earlier, API said.
The cost of September Brent crude futures on the London-based ICE Futures exchange at 8:05 a.m. Wednesday stands at $83.19 per barrel, down $0.45 (0.54%) from the previous session’s closing price. On Tuesday, these contracts rose $0.9 (1.1%) to $83.64 per barrel, the highest since April 18.
The price of WTI crude oil futures for September at the electronic trading of the New York Mercantile Exchange (NYMEX) fell by $0.46 (0.58%) to $79.17 per barrel. At the end of previous trading, the cost of these contracts rose by $0.89 (1.1%), to $79.63 per barrel, which is also the highest value since April 18.
Official data on energy reserves in the U.S. for the week ending July 21, will be released by the Department of Energy at 17:30 Q. Experts surveyed by S & P Global Commodity Insights, on average, predict a decline in oil reserves by 4.4 million barrels, gasoline – by 2 million barrels, distillates – by 2.3 million barrels.
On the eve it became known that the Chinese authorities intend to stimulate consumption, including the purchase of cars and electronics, as well as demand for services, including sports, tourism and recreation.
“The situation in China is very important for the global growth in oil demand this year, and traders had concerns about the weaker-than-expected recovery of the country’s economy, – said in a review of ING, quoted by Market Watch. – Signals of new stimulus help to reduce these concerns”.
Benchmark crude oil prices are moderately higher on Tuesday morning due to ongoing concerns over fuel shortages in the global market.
The price of September Brent futures on London’s ICE Futures exchange is at $82.95 a barrel by 8:05 a.m. Q2, up 21 cents (0.25%) from the previous session’s close. On Monday, these contracts rose in price by $1.67 (2.2%) – to $82.74 per barrel, ending trading at the maximum mark since April 19.
Quotes of futures for WTI crude oil for September at the electronic trading of the New York Mercantile Exchange (NYMEX) by the specified time rose by 24 cents (0.3%) and amounted to $78.98 per barrel. They rose $1.67 (2.2%) to $78.74 a barrel at the end of the previous session, hitting their highest since April 24.
“The unquenchable thirst for summer oil created a snowball effect that led to a multi-week rally,” said Manish Raj, managing director of Velandera Energy Partners. – Supply cuts from Saudi Arabia and Russia have led to increased demand for U.S. WTI crude from Asian buyers.”
According to him, the current situation was influenced by several factors, including growing demand in the U.S. during the summer, strong economic recovery in China and positive outlook for demand in India, where supply remains tight.
Record high demand in the near term will lead to a significant shortage of oil in the market and increase prices for the Brent grade to $86 per barrel by the end of the year, analysts at Goldman Sachs Group believe.
Meanwhile, data from oilfield services company Baker Hughes showed that last week the number of active drilling rigs in the U.S. decreased by 7 units to 530.
Oil prices are falling on Monday after a strong rise at the end of last week.
The cost of September futures for Brent on the London-based ICE Futures exchange at 8:15 a.m. on Monday is $80.95 per barrel, down $0.12 (0.15%) from the previous session’s closing price. On Friday, these contracts rose $1.43 (1.8%) to $81.07 per barrel.
The price of WTI oil futures for September at the electronic trading of the New York Mercantile Exchange (NYMEX) fell by $0.14 (0.18%) to $76.93 per barrel. At the end of previous trading, the cost of these contracts rose by $1.42 (1.9%), to $77.07 per barrel.
At the end of last week Brent rose by 1.5%, the cost of WTI rose by 2.3%, to the maximum since April 25.
Traders’ attention this week is focused on the Federal Reserve (Fed) meeting, which is expected to raise the rate by another 25 basis points. Continued tightening of monetary policy by the U.S. central bank raises the likelihood of a downturn in the economy and, consequently, lower demand for oil.
“Expectations of a new rate hike by the Fed are putting some pressure on the oil market, however, I believe that this event is largely already priced in,” notes Warren Patterson, who is responsible for commodities strategy at ING Groep NV.
The market is supported by expectations of lower supply amid Saudi Arabia’s production cuts.
The head of the International Energy Agency Fatih Birol said on Bloomberg TV at the weekend that due to production cuts by a number of countries, the oil market may face a deficit in the second half of the year even though there is no significant growth in demand in China.
Benchmark crude oil prices are rising moderately on Tuesday morning after declines in the previous two sessions.
The price of September Brent futures on London’s ICE Futures exchange is at $78.68 a barrel by 8:46 a.m. Q2, up 18 cents (0.23%) from the previous session’s close. On Monday, these contracts fell in price by $1.37 (1.7%) – to $78.5 per barrel.
Quotes of futures for WTI oil for August at the electronic trading of the New York Mercantile Exchange (NYMEX) to the specified time rose by 23 cents (0.31%) and amounted to $74.38 per barrel. At the end of the previous session they fell by $1.27 (1.7%) – to $74.15 per barrel.
Oil finished in the negative two last sessions in a row. On the eve, the negative factor was statistical data from China, which indicated the growth of China’s GDP by 6.3% in annualized terms in the second quarter after a rise of 4.5% in January-March. The consensus forecast of experts surveyed by Trading Economics had called for a 7.3% increase.
“Weaker-than-expected macroeconomic data from China and oil market reaction suggest that demand remains the key concern for the market,” said ING Groep NV strategist Warren Patterson. – However, we still maintain a constructive outlook and believe that the gap between supply and demand will narrow significantly in the second half of the year”.
In addition, the decrease was caused by the news of resumption of production at Al Sharara and Al Fil fields in Libya, where production was suspended last week due to protests.
On Tuesday, prices are supported by the forecast of the US Department of Energy, which provides for a decrease in shale oil production in the States in August to 9.4 million barrels per day. If the forecast comes true, the production cut will be recorded for the first time since December last year.
Oil prices of benchmark grades are moderately rising on Thursday morning after rising at the end of the previous session, caused by the fall of the dollar.
The price of September futures for Brent on London’s ICE Futures exchange at 8:18 a.m. Q2 is $80.3 per barrel, up 19 cents (0.24%) from the previous session’s close. On Wednesday, these contracts rose by $0.71 (0.9%) – to $80.11 per barrel, having updated the maximum since the end of April.
Quotes of futures for WTI crude oil for August at the electronic trading of the New York Mercantile Exchange (NYMEX) by the specified time rose by 14 cents (0.18%) and amounted to $75.89 per barrel. At the end of the previous session they rose by $0.92 (1.2%) – to $75.75 per barrel.
On the eve it became known that the growth rate of consumer prices in the U.S. slowed to 3% in June from 4% in May, having updated the minimum since March 2021. Analysts on average expected a decline to 3.1%.
Oil traders are keeping an eye on easing inflationary pressures as this may result in the Federal Reserve (Fed) having no need to raise interest rates further, meaning “the current positive conditions in the economy may persist for some time,” said Colin Cieszynski, senior strategist at SIA Wealth Management.
“This has helped raise demand expectations, while supply from Saudi Arabia and Russia remains subdued,” he added.
The prospect of an imminent end to the U.S. monetary tightening cycle collapsed the dollar, which supported commodity prices. The ICE index, which shows the dollar’s performance against six major currencies, plunged 1.2% the day before, hitting its lowest level in more than a year.
The U.S. Department of Energy report, which indicated a sharp increase in oil reserves in the country last week – by almost 6 million barrels instead of the expected increase by 483 thousand barrels.
Gasoline inventories remained virtually unchanged, while distillate stocks rose by 4.815 million barrels. Experts surveyed by Trading Economics on average forecasted a decrease of 727 thousand barrels and 262 thousand barrels, respectively.
Stocks at the terminal in Cushing, where oil traded on Nymex is stored, decreased by 1.605 million barrels over the week.
