Crude oil futures prices climbed on the New York and London markets on May 12 upon concerns that additional Western sanctions against Russia could hinder the volume of Russia’s oil exports. Crude markets have been volatile since Ukraine’s Crimea region annexed to Russia earlier this year.
European Union representatives met to discuss strengthening sanctions again Ukrainian and Russian companies and individuals in response to the Russia-Ukraine conflict. Meanwhile, Ukraine’s presidential election is scheduled for May 25.
On May 11, pro-Russian separatists in eastern Ukraine said a majority of people voted for independence from Ukraine. Western leaders called the secession referendum illegitimate, and Russian officials said they respected the vote.
The Organization of the Petroleum Exporting Countries could cover any shortfall resulting from possible disruption of Russia’s oil exports, Saudi Arabia’s Minister of Petroleum and Mineral Resources Ali al-Naimi said.
Saudi Arabia already has played a key role in cushioning against supply disruptions from Libya, Nigeria, Iraq, and South Sudan during the last 2 years, he told reporters May 12 on the sidelines of a conference in Seoul.
“We are willing to supply any shortage which may arise,” he said, adding that Saudi Arabia’s currently produces about 9.6 million b/d while it has the capacity to produce 12.5 million b/d.
Energy prices
The New York Mercantile Exchange June crude oil contract price increased 60¢ on May 12, closing at $100.59/bbl. The July contract climbed 63¢ to settle at $99.94/bbl.
The June natural gas contract lost 9.7¢ to a rounded $4.43/MMbtu.
Heating oil for June delivery gained 1.17¢ to a rounded $2.92/gal. Reformulated gasoline stock for oxygenate blending for June delivery rose 1.86¢ to a rounded $2.91/gal.
In London, the June ICE contract for Brent crude delivery increased 52¢, closing at $108.41/bbl. The July contract gained 51¢ to settle at $107.79/bbl. The ICE gas oil contract for May held unchanged at $906.50/tonne.
The OPEC basket of 12 benchmark crudes on May 12 was $104.21/bbl, down 25¢.
Contact Paula Dittrick at [email protected].
