Light, sweet crude oil prices fell July 17 to settle just above $46/bbl, breaking a 5-day gaining streak, which analysts attributed to concerns about lingering ample world oil supplies amid growing uncertainty about major producers’ future output levels.
The US Energy Information Administration forecast the nation’s unconventional oil production will reach 5.585 million b/d in August, up 113,000 b/d from July. Shale production has risen every month so far this year.
Investors awaited oil and product inventory estimates from the American Petroleum Institute on July 18 and the EIA on July 19.
On world oil markets, Ecuador said it can no longer afford to continue meeting its production-cut target despite an agreement by the Organization of Petroleum Exporting Countries and some non-OPEC countries to maintain production-cut targets of 1.8 million b/d through early 2018.
Ecuador had vowed to cut 26,000 b/d. In May, Ecuador’s production was 528,000 b/d.
Analysts said other participants also might drop out of the production-cut agreement given rising production from Libya and Nigeria.
Russia is participating in the production-cut target agreement. OPEC compliance with production-cut targets will be discussed during a committee meeting in St. Petersburg, on July 24.
Energy prices
The August light, sweet crude contract on NYMEX dropped 52¢ on July 17 to settle at $46.02/bbl. The September contract was down 52¢ to close at $46.23/bbl.
The NYMEX natural gas price for August rose 4¢ to $3.02/MMbtu. The Henry Hub cash gas price was $3.02/MMbtu, up 9¢.
Heating oil futures for August dropped 1.5¢ to a rounded $1.50/gal. Reformulated gasoline stock for oxygenate blending for August declined a fraction of a penny to remain at a rounded $1.56/gal.
The Brent crude contract for September on London’s ICE declined 49¢ to $48.42/bbl while the October contract was down 49¢ to $48.68/bbl. The August gas oil contract was $448.50/tonne, up 75¢.
OPEC’s basket of crudes on July 17 was $46.80/bbl, up 40¢.
Contact Paula Dittrick at [email protected].
