Light, sweet crude oil prices fell by more than $1/bbl for a second consecutive trading session on the New York market June 4 while Brent crude oil prices dropped about $1.50/bbl on the London market.
Brent for August delivery closed just under $75.30/bbl on June 4 after having touched 3-year highs last month. The Brent contract for July briefly reached above $80/bbl during May 17 trading but dropped to $79.30/bbl by closing.
The Wall Street Journal in May surveyed 12 investment bankers on oil prices. They expect Brent will average more than $70/bbl for 2018 and US light, sweet crude oil will average $66/bbl.
Both estimates are $6/bbl higher than what bankers forecast during April’s survey.
“The key driver here is basically supply risk—supply risks from Iran and Venezuela,” Harry Tchilinguirian, BNP Paribas global head of commodity markets strategy, told the WSJ. BNP Paribas was among the banks surveyed.
Meanwhile, some members of the Organization of Petroleum Exporting Countries are talking about production-cut targets in anticipation of a June 20-21 OPEC meeting in Vienna.
OPEC members Kuwait and Iran reportedly disagree with talks between Saudi Arabia and Russia last week to ease up on existing production-cut targets, scheduled to expire Dec. 31.
The production-cut targets involve OPEC’s 14 members and some producers outside the cartel, including Russia.
Energy prices
The July light, sweet crude contract on the New York Mercantile Exchange fell $1.06 to settle at $64.75/bbl on June 4. The August price was down $1.09 to $64.68/bbl.
The NYMEX natural gas price for July fell 3¢ to a rounded $2.93/MMbtu. The Henry Hub cash gas price gained 1¢ to $2.91/MMbtu on June 4.
Ultralow-sulfur diesel for July declined 2¢ to a rounded $2.15/gal. The NYMEX reformulated gasoline blendstock for July fell nearly 2¢ to settle at $2.12/gal.
Brent crude oil for August declined $1.50 to settle at $75.29/bbl on London’s International Commodity Exchange. The September contract was down $1.41 to $75.10/bbl. The gas oil contract for June was $666/tonne, down $5.25.
OPEC’s basket of crudes was $73.56/bbl on June 4, down 67¢.
Contact Paula Dittrick at [email protected].
