Light, sweet crude oil for June delivery dropped by nearly $1.80 to $61.81/bbl on the New York market May 2 while the Brent contract for July dropped by more than $1.40 to settle at $70.75/bbl in London.
Crude on the New York market fell to the lowest settlement price since Apr. 1, having declined five times in seven trading sessions.
The US Energy Information Administration weekly oil inventory showed US crude supplies, excluding the Strategic Petroleum Reserve, rose for a fifth time in 6 weeks.
US crude oil inventories for the week ended Apr. 26 increased by 9.9 million bbl from the previous week to 470.6 million bbl. US crude oil inventory levels are at a 5-year average for this time of year (OGJ Online, May 1, 2019).
Separately, the American Petroleum Institute said its own estimates showed US crude inventories increased by 6.8 million bbl for the week ended Apr. 26.
Some traders and analysts are concerned oil prices possibly could fall below $50/bbl if the Organization of Petroleum Exporting Countries increases production as the US administration suggests.
US President Donald Trump wants OPEC to increase supply to make up any gap on world markets created by lower Iranian oil exports. The Trump administration is ending US waivers on Iran sanctions that it had granted to eight countries, including China and India.
Meanwhile, US oil production is climbing. EIA’s Petroleum Status Report showed US oil production reached a record of 12.3 million b/d for the week ended Apr. 26. The total was up 100,000 b/d from the previous week.
Energy prices
The June contract for light, sweet crude oil on the New York Mercantile Exchange declined $1.79 to settle at $61.81/bbl on May 2. The price for July delivery was down $1.79 to settle at $61.90/bbl.
NYMEX natural gas for June fell 3¢ to $2.59/MMbtu.
Ultralow-sulfur diesel for June rose 1.6¢ to a rounded $2.08/gal. The NYMEX reformulated gasoline blendstock for June fell 4¢ to a rounded $2.02/gal.
Brent crude for July dropped $1.43 to $70.75/bbl. The August price fell $1.48 to settle at $72.02/bbl.
The gas oil contract for May decreased $1.50 to $637.50/tonne on May 2.
The average for OPEC’s basket of crudes was $70.98/bbl on May 2, down $1.02 from May 1.
Contact Paula Dittrick at [email protected].
