Crude oil futures for July delivery rose modestly on the New York market to settle above $60/bbl in June 18 trading, marking its highest closing price in a week. Oil prices trading on the New York Mercantile Exchange have held within a narrow trading band for about 2 weeks, which analysts attribute to ample world oil supplies.
Early June 19 trading saw oil prices fall while analysts and traders closely watched Greek debt negotiations and an approaching June 30 deadline in the Iran nuclear talks.
“Over the next 14 days, there is likely to be increasing risk tension regarding the Greek Eurozone membership, which could help to drive risk aversion higher and potentially also the dollar stronger,” Bjarne Schieldrop, SEB Markets analyst, told Reuters. “This is likely to be bearish for Brent crude oil.”
Eurozone leaders are scheduled to attend a summit about Greece on June 22. A Greek default could hurt European oil demand, said Olivier Jakob of Petromatrix.
“Most of the European oil demand growth this year is coming from the southern countries of Europe,” Jakob said. “Therefore, if there was a Greek default and a contagion of a risk premium to other southern European countries, it could have a negative impact on European oil demand.”
If a deal were to be reached between Iran and the West, it could ease international sanctions against Tehran and release more Iranian crude onto an already oversupplied global market.
“We currently view the chance as fairly high for a nuclear deal resolution, which also will be bearish for Brent if it happens,” Schieldrop told Reuters.
The natural gas contract for July was down a rounded 8¢ to a rounded $2.78/MMbtu. The Henry Hub, La., gas price was down 7¢ to $2.86/MMbtu.
Heating oil for July was up less than a penny to a rounded $1.92/gal. The price for reformulated gasoline stock for oxygenates blending for July also inched up nearly a penny to a rounded $2.11/gal.
The August ICE contract for Brent crude was up 39¢ to $64.26/bbl while the September contract gained 32¢ to $64.99/bbl. The ICE gas oil contract for July was up $2.50 to $588/tonne.
The average price for OPEC’s basket of 12 benchmark crudes for June 18 was $60.55/bbl, up 28¢.
Contact Paula Dittrick at [email protected].
*Paula Dittrick is editor of OGJ’s Unconventional Oil & Gas Report.