Light, sweet crude oil for June delivery settled above $71/bbl on the New York market May 15 while Brent crude oil for July delivery settled at nearly $78.50/bbl on the London market.
The International Energy Agency monthly report cited higher oil prices as the reason behind its downward revision of estimated 2018 demand growth. IEA now forecasts demand growth of 1.4 million b/d from a previous 1.5 million b/d.
The report, released May 16, estimated total 2018 oil demand at 99.2 million b/d.
Olivier Jakob, managing director of Swiss-based consultancy Petromatrix, said, “We warned about the negative impact that higher oil prices should have.”
He noted Brent oil prices have climbed since Jan. 1, boosted by crude production cuts by major producers and by worries about increased geopolitical tensions, especially in the Middle East where stable oil flow is crucial to world oil supply.
Investors continued to monitor developments with Iran, following the US withdrawal from the 2015 international agreement, which had lifted international sanctions against Iran.
France’s Total SA said it dropped plans for South Pars 11, a gas development project to supply gas within Iran. PetroChina was a partner on SP11.
“Total will not be in a position to continue the SP11 project and will have to unwind all related operations before Nov. 4 unless Total is granted a specific project waiver by US authorities with the support of the French and European authorities,” the company said.
Energy prices
The June light, sweet crude contract on the New York Mercantile Exchange gained 35¢ on May 15 to settle at $71.31/bbl. The July price was up 38¢ to $71.37/bbl.
The NYMEX natural gas price for June edged down less than 1¢ to remain at a rounded $2.84/MMbtu. The Henry Hub cash gas price was unchanged at $2.83/MMbtu on May 15.
Ultralow-sulfur diesel for June edged down less than 1¢ to settle at a rounded $2.25/gal. The NYMEX reformulated gasoline blendstock for June gained less than 1¢ to remain at $2.20/gal.
Brent crude oil for July increased 20¢ to settle at $78.43/bbl on London’s International Commodity Exchange. The August contract was up 28¢ to $78.27/bbl. The gas oil contract for June was $687.50/tonne, up $6.75.
OPEC’s basket of crudes was $75.47/bbl for May 15, up $1.27.
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.