Crude oil futures prices fell on the New York market on July 28, which analysts attributed to concerns that demand for gasoline will drop with the end of the summer-driving season. Labor Day is seen as the end of the US summer vacation season and increased gas demand.
Recent government weekly inventory reports show US gasoline supplies have climbed for 3 consecutive weeks. The Energy Information Administration is scheduled July 30 to report statistics for the week ended July 25.
Elsewhere, international oil traders continue to monitor geopolitical events for signs of any potential oil supply disruptions. Given the ongoing conflict with pro-Russian separatists in Ukraine, US President Barack Obama and European Union leaders indicated they plan to adopt tighter sanctions targeted at Russian businesses. The EU said it will impose new sanctions aimed at Russia’s state-owned banks and will limit technology exports, important for Russian oil and weapon industries.
“The impact on energy should be minimal in the short term,” Citigroup said in a research note regarding sanctions. “The costs to Moscow come in the form of the threats that sanctions imply for long-term oil and gas production in Russia, upon which the government depends for revenues.”
US officials on July 28 said Russia has violated a 1987 missile treaty by testing a new type of intermediate-range cruise missile. The White House sent a letter to Russia President Vladimir Putin demanding that Russia return to compliance.
The latest accusation comes amid international criticism of Russia following the July 17 crash of Malaysia Airlines Flight 17, which killed 298 people. Cause of the crash remains under international investigation, but US officials suggest a ground-to-air missile was involved.
The natural gas contract for August dropped 3.4¢ to a rounded $3.75/MMbtu. On the US cash market, gas at Henry Hub, La., rose 3¢ to $3.82/MMbtu.
Heating oil for August delivery gave up 2.78¢ to a rounded $2.89/gal. Reformulated gasoline stock for oxygenate blending for August delivery was down 1.61¢ to a rounded $2.85/gal.
The September ICE contract for Brent crude delivery dropped 82¢ to $107.57/bbl. The October contract decreased 83¢ to $107.87/bbl. The ICE gas oil contract for August dropped $2.75 to $889.25/tonne.
A price for the Organization of Petroleum Exporting Countries’ basket of 12 benchmark crudes was not posted for July 28.
Contract Paula Dittrick at email@example.com.