MARKET WATCH: Crude oil benchmarks gain on IMF economic forecast

Jan. 23, 2018
Crude oil prices rose on the New York and London markets Jan. 22 after the International Monetary Fund increased its world economic growth forecast saying the economy could grow by 3.9%/year in 2018 and 2019, up 0.2% from its previous estimate.

Crude oil prices rose on the New York and London markets Jan. 22 after the International Monetary Fund increased its world economic growth forecast saying the economy could grow by 3.9%/year in 2018 and 2019, up 0.2% from its previous estimate.

The revision partially stemmed from recently approved US tax-code changes, IMF representatives told World Economic Forum participants in Davos, Switzerland, on Jan. 22. Oil prices rose following IMF’s statements.

Separately, Commerzbank analysts issued a research note saying that the IMF’s latest forecast “further improves the already fairly rosy demand prospects on the oil market.”

The International Energy Agency has forecast world oil demand will rise 1.3 million b/d, which “could prove too low,” Commerzbank analysts said.

The Organization of Petroleum Exporting Countries has forecast world oil demand will rise by 1.5 million b/d while the US Energy Information Administration forecast demand will increase by 1.7 million b/d.

Energy prices

The February light, sweet crude contract on the New York Mercantile Exchange gained 12¢ on Jan. 22 to $63.49/bbl. The March contract increased 26¢ to $63.57/bbl.

The NYMEX natural gas price for February added nearly 4¢ to a rounded $3.22/MMbtu. The Henry Hub cash gas price fell 5¢ to $3.13/MMbtu.

Ultralow-sulfur diesel for February edged down less than 1¢ to remain at a rounded $2.06/gal. The NYMEX reformulated gasoline blendstock for February gained 1.65¢ to a rounded $1.88/gal.

The Brent crude contract for March on London’s ICE increased 42¢ to settle at $69.03/bbl on Jan. 22. The April contract was up 39¢ to $68.63/bbl. The gas oil contract for February was $614.24/tonne, up $6.25.

OPEC’s basket of crudes was $66.89/bbl on Jan. 22, up 41¢.

Contact Paula Dittrick at [email protected].