MARKET WATCH: NYMEX oil prices increase on US crude inventory decline
Light, sweet crude prices rose modestly on the New York market June 13 after a weekly US government report showed a sharp fall in oil inventories.
US crude oil inventories, excluding the Strategic Petroleum Reserve, decreased 4.1 million bbl to an estimated 432.4 million bbl for the week ended June 8, according to a weekly report from the US Energy Information Administration (OGJ Online, June 13, 2018). The Weekly Petroleum Status Report said US oil production was 10.9 million b/d for the week ended June 8, up 100,000 b/d from the previous week.
The Wall Street Journal said Saudi Arabia’s oil minister planned a trip to Russia this week to discuss ways to manage a possible production increase. The Organization of Petroleum Exporting Countries has a meeting scheduled June 22.
OPEC and some major producers, including Russia, previously agreed to production-cut targets, effective Jan. 1, 2017, and currently scheduled to expire at yearend.
Oil officials from Russia and Saudi Arabia have talked of increasing production given geopolitical risks regarding oil supply from Iran and Venezuela.
“Irrespective of the inner workings of OPEC, Saudi Arabia and Russia were the driving forces to sign the supply deal [in late 2016] and most likely will decide in a bilateral agreement to partially ease production restrictions,” Norbert Ruecker, Julius Baer head of macro and commodity research, told the WSJ.
“The near-term outlook for oil prices remains clouded in high uncertainty given the difficult-to-predict political factors at play,” Ruecker added.
Energy prices
The July light, sweet crude contract on the New York Mercantile Exchange gained 28¢ to settle at $66.64/bbl on June 12. The August price was up 24¢ to $66.52/bbl.
The NYMEX natural gas price for July gained 2¢ to a rounded $2.96/MMbtu. The Henry Hub cash gas price increased 2¢ to $2.94/MMbtu on June 13.
Ultralow-sulfur diesel for July gained 2¢ to $2.18/gal. The NYMEX reformulated gasoline blendstock for July climbed 3.5¢ to a rounded $2.12/gal.
Brent crude oil for August gained 86¢ to $76.74/bbl on London’s International Commodity Exchange. The September contract rose 83¢ to $76.48/bbl. The gas oil contract for July was $666/tonne, down $1.25.
OPEC’s basket of crudes was $73.35/bbl on June 13, down 76¢.
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.