MARKET WATCH: Oil benchmarks gain for third session
Crude oil benchmarks gained on markets in New York and London for a third consecutive trading session May 16 with light, sweet crude marking its biggest single-session gain in 3 weeks as the June contract closed above $62.80/bbl and the July contract closed above $63/bbl.
Analysts attributed gains in oil future prices to heightened US-Iran tensions and threatening actions that could disrupt oil shipments across the Middle East, particularly the Hormuz Strait.
Four commercial ships, including two Saudi vessels, were sabotaged on May 12 in the Gulf of Oman. Two days later, armed drones attacked a Saudi pipeline and two pumping stations.
Iran-allied Houthi rebels in Yemen claimed responsibility for the pipeline attack. In an apparent counterattack, Saudi-led coalition warplanes bombed areas held by Iran-allied rebels in Yemen on May 16.
US officials, citing unspecified intelligence, have flagged escalated threats from Iran and its allies. The Saudi-led coalition issued a statement saying its airstrikes targeted Houthi military bases and storage areas for weapons and ammunition.
The strikes killed at least six civilians, the Wall Street Journal reported, citing international monitors.
Separately, the Organization of Petroleum Exporting Countries said its crude oil production was slightly above 30 million b/d in April, down only marginally from the previous month. Crude oil production decreased mostly in Iran, Saudi Arabia, and Angola. Production increased in Iraq, Nigeria, and Libya, secondary sources told OPEC.
Energy prices
Crude oil on the New York Mercantile Exchange for June gained 85¢ to settle at $62.87/bbl on May 16 while the July contract climbed 82¢ to settle at $63.06/bbl.
NYMEX natural gas for June was up nearly 4¢ to settle at $2.64/MMbtu.
Ultralow-sulfur diesel for June increased more than 3¢ to a rounded $2.12/gal. The NYMEX reformulated gasoline blendstock for June gained nearly 5¢ to $2.06/gal.
Brent crude for July gained 85¢ to $72.62/bbl. The August price increased 80¢ to settle at $71.70/bbl.
The gas oil contract for June climbed $14.75 to $665.25/tonne on May 16.
The average for OPEC’s basket of crudes was $72.61/bbl on May 16, up $1.35.
Contact Paula Dittrick at [email protected].
About the Author
Paula Dittrick
Senior Staff Writer
Paula Dittrick has covered oil and gas from Houston for more than 20 years. Starting in May 2007, she developed a health, safety, and environment beat for Oil & Gas Journal. Dittrick is familiar with the industry’s financial aspects. She also monitors issues associated with carbon sequestration and renewable energy.
Dittrick joined OGJ in February 2001. Previously, she worked for Dow Jones and United Press International. She began writing about oil and gas as UPI’s West Texas bureau chief during the 1980s. She earned a Bachelor’s of Science degree in journalism from the University of Nebraska in 1974.