Barclays Capital researcher Miswin Mahesh said in a research note that he continues to believe at least two quarters of prices below $40/bbl are required to balance the oil market.
“If current price gains gather more momentum and hold, this would delay the balancing process for oil and bring downside risks,” for oil prices, Mahesh said.
He noted oil supply statistics are helping “sow the seeds of a recovery,” but he also said world oil demand growth so far this year appears to be “softer” than during the same period last year.
Energy prices
The April crude oil contract on the New York Mercantile Exchange declined $1.32 to $37.18/bbl on Mar. 14. The May contract was down $1.25 to $38.84/bbl.
The NYMEX natural gas contract for April edged down less than a penny to a rounded $1.82/MMbtu. The Henry Hub gas price for Mar. 14 was $1.68/MMbtu, dropping 4¢.
Heating oil for April delivery fell by 2¢ to a rounded $1.20/gal. The price for reformulated gasoline stock for oxygenates blending for April declined by about 2¢ to a rounded $1.42/gal on Mar. 14.
The Brent crude contract for May on London’s ICE fell 86¢ to $39.53/bbl. The June contract was down 93¢ to $40.16/bbl. The ICE gas oil contract for April was $355.75/tonne, down $11.25.
The average price for OPEC’s basket of 12 benchmark crudes was $34.74/bbl, dropping 88¢.
Contact Paula Dittrick at [email protected].