The light, sweet crude oil contract for May delivery fell on the New York market Mar. 27 to settle below $48/bbl. Before closing, crude oil dipped to a trading session low of $47.08/bbl, which was within 10¢ of a low set in November 2016.
But crude prices for the US benchmark edged up in early trading on Mar. 28.
Goldman Sachs Group Inc. issued a research note saying its analysts do not believe current crude oil supply and demand merits an extension of the major producers’ agreement to trim production 1.8 million b/d in 2017 compared with late 2016. The Organization of Petroleum Exporting Countries’ share is 1.2 million b/d. OPEC compliance with the production targets has been high while world economic growth supports strong demand growth, Goldman’s said.
“We believe that the rebalancing of the oil market is in fact making progress despite the record high US crude inventories,” Goldman analyst Damien Courvalin wrote.
The research note said a sharp slowing in oil demand growth or sharply rebounding production by Libya or Nigeria might justify an extension of the production-cut targets, which OPEC will review at its May meeting.
Energy prices
The crude oil contract for May delivery on the New York Mercantile Exchange declined 24¢ on Mar. 27 to close at $47.73/bbl while the June contract dropped 21¢ to $48.30/bbl.
The natural gas price for April delivery fell 2¢ to a rounded $3.05/MMbtu. The Henry Hub cash gas price closed Mar. 27 at $2.95/MMbtu, up 3¢.
Heating oil for April edged up less than 1¢ to remain at a rounded $1.50/gal. Reformulated gasoline stock for oxygenate blending for April climbed 1.4¢ to a rounded $1.62/gal.
The Brent crude contract for May on London’s ICE decreased 5¢ to $50.75/bbl. The June contract dropped 2¢ to $50.90/bbl. The gas oil contract settled at $451.25/tonne on Mar. 27, up $2.25.
The average price for OPEC’s basket of benchmark crudes on Mar. 27 was $48.25/bbl, down 1¢.
Contact Paula Dittrick at [email protected].
