Light, sweet crude oil prices for July and August contracts settled nearly $2/bbl higher on the New York market June 18 and Brent crude oil prices for August and September rallied by more than $1/bbl in London with the August contract settling above $62/bbl.
Saudi Arabia intends to push for tighter compliance to the Organization of Petroleum Exporting Country production targets. Other major producers, including Russia, also agreed to the existing production levels, but Russia appears to be the main obstacle to extending the OPEC cuts.
Iraq, Nigeria, and other countries that did not comply with the December 2018 agreement will need to abide by an anticipated extension of those production levels, a Saudi oil adviser told the Wall Street Journal.
The move would reduce crude supplies from these producers by 300,000-400,000 b/d, WSJ reported. When OPEC and its allies met in December 2018, the group agreed to curb overall output by 1.2 million b/d.
Saudi Arabia reduced its production by about 150,000 b/d to 9.65 million b/d in May, Saudi oil officials said that production level continued into June.
Energy prices
Light, sweet crude oil on the New York Mercantile Exchange for July delivery gained $1.97 to $53.90/bbl while the August contract increased $1.94 to settle at $54.11/bbl.
NYMEX natural gas for July edged down less than a penny to a rounded $2.38/MMbtu.
Ultralow-sulfur diesel for July increased nearly 3¢ to a rounded $1.83/gal. The NYMEX reformulated gasoline blendstock for July gained 3¢ to a rounded $1.72/gal.
Brent crude for August rose $1.20 to $62.14/bbl. The September price increased $1.34 to settle at $61.33/bbl.
The gas oil contract for July rose $4.50 to $562.50/tonne on June 18.
The average for OPEC’s basket of crudes was down 17¢ to $61.43/bbl on June 18.
Contact Paula Dittrick at [email protected].
