The light, sweet crude oil contract for April dropped 90¢/bbl on the New York market Feb. 27 while the Brent April contract dropped 87¢/bbl on the London market, which analysts attributed to pressure from a strengthening US dollar and an anticipated climb in US oil supply levels.
The oil price drop came after Federal Reserve Chairman Jerome Powell said the central bank is on track to raise interest rates three times this year. The Dow Jones Industrial Average and the S&P 500 each closed down more than 1%.
Meanwhile, the Wall Street Journal Dollar Index rose 0.6% to 84.05. Oil is traded in US dollars, so a stronger dollar makes oil more expensive for buyers using other currencies.
The US Energy Information Administration was scheduled to release its weekly inventory report on oil and product levels Feb. 28. A WSJ poll of analysts said analysts expect oil supplies, excluding the Strategic Petroleum Reserve, rose by 2 million bbl for the week ended Feb. 23.
Separately, the American Petroleum Institute said Feb. 27 that its data for last week showed crude supplies grew by 933,000 bbl.
Energy prices
The April light, sweet crude contract on the New York Mercantile Exchange fell 90¢ on Feb. 27 to settle at $63.01/bbl. The May contract dropped 87¢ to $62.90/bbl.
The NYMEX natural gas price for April edged down less than 1¢ to a rounded $2.68/MMbtu. The Henry Hub cash gas price was up 1¢ to $2.60/MMbtu on Feb. 27.
Ultralow-sulfur diesel for March decreased by 2¢ to a rounded $1.96/gal. The NYMEX reformulated gasoline blendstock for March fell 2¢ to a rounded $1.80/gal.
Brent crude oil for April settled down 87¢ to $66.63/bbl on London’s International Commodity Exchange. The May contract was down 77¢ to $66.52/bbl. The gas oil contract for March was $594.50/tonne, down $4.50.
The Organization of Petroleum Exporting Countries’ basket of crudes was $64.99/bbl on Feb. 27, down 20¢.
Contact Paula Dittrick at [email protected].
