Light, sweet crude prices for June delivery gained modestly to settle under $68/bbl on the New York Mercantile Exchange May 2 while Brent crude oil prices for July delivery gained modestly in London to remain above $73/bbl.
Analysts said oil prices held steady while US President Donald Trump faces a May 12 deadline to decide whether to renew a 120-day waiver of sanctions that Congress previously imposed on Iran.
The Center for Strategic & International Studies issued a note saying it’s unclear what happens if Trump does not renew the wavier.
Sanctions were lifted under the Joint Comprehensive Plan of Action (JCPOA), which several countries signed in 2015. The agreement provides for taking disputes first to a joint commission of nations involved and ultimately to a three-judge advisory board.
Trump could decide to reimpose earlier US sanctions, renew a waiver of sanctions for 120 days, or impose entirely new US sanctions by executive order.
The US Energy Information Administration reported the nation’s crude inventories rose unexpectedly for the week ended Apr. 27, up 6.2 million bbl to 436 million bbl, putting oil in storage in the lower half of the average range for this time of year (OGJ Online, May 2, 2018).
Traders and analysts noted oil supplies remained below historical averages. Commerzbank said the inventory build was concentrated along the West Coast rather than being representative of supplies nationwide.
Energy Aspects, a consultant, issued a research note saying US crude supplies were up by less than 11.5 million bbl so far for the year compared with the a 5-year average build of 58 million bbl.
The Weekly Petroleum Status Report said US production rose 33,000 b/d to 10.619 million b/d for the week ended Apr. 27.
Energy prices
The June light, sweet crude contract on the NYMEX gained 68¢ on May 2 to settle at $67.93/bbl. The July price was up 64¢ to $67.77/bbl.
The NYMEX natural gas price for June declined nearly 5¢ to settle at $2.75/MMbtu. The Henry Hub cash gas price was $2.73/MMbtu on May 2, down 2¢.
Ultralow-sulfur diesel for June rose 2¢ to settle at a rounded $2.12/gal. The NYMEX reformulated gasoline blendstock for June declined nearly 1¢ to a rounded $2.08/gal.
Brent crude oil for July gained 23¢ to settle at $73.36/bbl on London’s International Commodity Exchange. The August contract was up 24¢ to $72.94/bbl. The gas oil contract for May was $642/tonne, down $6.75.
The Organization of Petroleum Exporting Countries’ basket of crudes averaged $70.47/bbl on May 2, down 12¢.
Contact Paula Dittrick at [email protected].
