Brent crude oil prices gained modestly during the May 23 trading session in London to approach $80/bbl. Traders and analysts awaited news from a meeting of oil ministers in Russia that includes some Middle Eastern officials.
Iran faces new US sanctions following President Donald Trump’s decision to withdraw US participation from a 2015 international nuclear agreement. Members of the Organization of Petroleum Exporting Countries, especially Saudi Arabia, could fill any oil-supply gap.
Analysts awaited news reports from the St. Petersburg International Economic Forum, starting May 24, where oil ministers are expected to discuss US sanctions against Iran.
Olivier Jakob, Petromatrix managing director, said, “The main [oil price] risk for today and the next 2 days will come from the St. Petersburg Economic Forum as it provides an opportunity to have sound bites from the energy ministers of Saudi Arabia, the UAE, and Russia.”
OPEC and producers including Russia are scheduled to meet in Vienna during June to discuss production-cut target levels, due to expire Dec. 31.
Separately, analysts noted a surprising build in US oil inventories. The US Energy Information Administration reported the nation’s crude oil inventories, excluding the Strategic Petroleum Reserve, increased 5.8 million bbl for the week ended May 18, to an estimated 438.1 million bbl (OGJ Online, May 23, 2018).
The Weekly Petroleum Status Report said US oil production was up 2,000 b/d to 10.725 million b/d for the week ended May 18 compared with the previous week. For the latest inventory, Alaska’s production fell 22,000 b/d to 480,000 b/d while production across the Lower 48 rose 24,000 b/d to 10.245 million b/d.
Energy prices
The July light, sweet crude contract on the New York Mercantile Exchange fell 6¢ to settle at $71.84/bbl on May 23. The August price was down 31¢ to $71.71/bbl.
The NYMEX natural gas price for June increased less than a penny to a rounded $2.91/MMbtu. The Henry Hub cash gas price gained 8¢ to $2.86/MMbtu on May 23.
Ultralow-sulfur diesel for June edged up less than a penny to a rounded $2.29/gal. The NYMEX reformulated gasoline blendstock for June fell 1¢ to settle at a rounded $2.26/gal.
Brent crude oil for July increased 23¢ to settle at $79.80/bbl on London’s International Commodity Exchange. The August contract was up 25¢ to $79.94/bbl. The gas oil contract for June was $697/tonne, down $5.50.
OPEC’s basket of crudes was $76.43/bbl on May 23, down 76¢.
Contact Paula Dittrick at [email protected].
