US and Brent crude oil benchmarks gained moderately on May 11 and continued rising in early May 12 trading, which analysts attributed to a weekly US government report showing the biggest draw to US oil inventories so far this year.
Crude oil prices have rebounded since dropping more than $2/bbl on both the New York and London markets on May 4, reaching 5-month lows.
The Energy Information Administration reported US crude oil supplies, excluding the Strategic Petroleum Reserve, dropped by 5.2 million bbl for the week ended May 5 (OGJ Online, May 11, 2017).
Analysts polled by S&P Global Platts had anticipated a decline of 1.8 million bbl. The American Petroleum Institute estimated a drop of 5.8 million bbl for the week ended May 5.
Baker Hughes Inc. was scheduled May 12 to release its weekly rig count, an indicator of future US oil production.
The count has increased by 7.3 rigs/week on average over the past year, making this the strongest recovery of the last 30 years, Martijn Rats, analyst at Morgan Stanley, wrote in a research report earlier this week.
Energy prices
The light, sweet contract for June crude oil delivery gained 50¢ to close at $47.83/bbl on the New York Mercantile Exchange May 11. The July contract also climbed 50¢ to settle at $48.20/bbl.
The natural gas price for June was up 8¢ to a rounded $3.37/MMbtu. The Henry Hub cash gas price gained 9¢ to $3.20/MMbtu on May 11.
Heating oil for June increased 1.5¢ to a rounded $1.49/gal. Reformulated gasoline stock for oxygenate blending for June gained 2¢ to a rounded $1.56/gal.
The Brent crude contract for July on London’s ICE was up 55¢ to settle at $50.77/bbl. The August contract increased 51¢ to $51.05/bbl. The June gas oil contract was $449/tonne, up $5.
The Organization of Petroleum Exporting Countries’ basket of crudes was $48.37/bbl on May 11, up $1.06.
Contact Paula Dittrick at [email protected].
