The crude oil contract prices for July delivery settled above $104.40/bbl on the New York market on June 9, reaching its highest front-month level since Mar. 3 while the spread between US light, sweet crude and Brent crude narrowed to $5.58/bbl, the smallest gap since Apr. 15.
The Organization of Petroleum Exporting Countries is scheduled to meet in Vienna on June 11. Market observers are waiting to see if the cartel decides to increase production quotas to meet anticipated higher demand during this year’s second half. Analysts generally expect the ceiling quota will remain unchanged.
Saudi Arabian officials suggest Saudi output likely will increase this year to replace halted Libyan oil exports.
The US Energy Information Administration was scheduled to release its Short-Term Energy Outlook on June 10, and the weekly petroleum inventory was scheduled for release on June 11.
The New York Mercantile Exchange July crude oil contract price was up $1.75, closing at $104.41/bbl on June 9. The August contract gained $1.65 to $103.59/bbl.
The natural gas contract for July fell 6.5¢ to a rounded $4.65/MMbtu. On the US cash market, gas at Henry Hub, La., was $4.66/MMbtu, rising 1¢.
Barclays Capital analyst Michael Cohen in New York expects gas futures prices will average about $4.50/MMbtu through August, assuming normal weather scenarios. He expects a combination of reduced coal-to-gas displacement and production growth will narrow the US gas storage deficit.
In a research note, Cohen said the US Environmental Protection Agency’s newly proposed Clean Power Plan for existing power plants “presents marginal upside risks to our 2015-20 natural gas demand forecast. However, in our view, the rule will likely take a long time to finalize and may not be implemented until 2020.”
Heating oil for July delivery increased 2¢ to a rounded $2.89/gal. Reformulated gasoline stock for oxygenate blending for July delivery rose a rounded 4.6¢ to a rounded $2.98/gal.
The July ICE contract for Brent crude delivery climbed $1.38, closing at $109.99/bbl. The August contract rose $1.29 to $109.15/bbl. The ICE gas oil contract for June was up $8.25 to $892.25/tonne.
The OPEC basket of 12 benchmark crudes was $105.72/bbl on June 9, up 34¢.
Contact Paula Dittrick at email@example.com.