Last week began with oil prices continuing to climb on concerns that tightening sanctions on Iran would cut oil supplies. Brent crude touched $75 for a short time after Moscow announced that it was halting some crude shipments to Europe due to contaminated pipelines. Thursday afternoon market sentiment reversed, and prices plunged circa $3 a barrel to close at $62.86 in New York and $71.61 in London on Friday. The price drop was helped by a presidential tweet that said “Spoke to Saudi Arabia and others about increasing oil flow. All are in agreement.”
Oil prices continued to climb slowly last week with Brent closing just below $72 a barrel, a new high for the year, and New York futures closed $8 a barrel lower at $64. Prices are still about $13 a barrel below the 2018 high of $85 set last October. The news last week was generally bullish with the Saudis reporting an official 277,000 b/d drop in February, Iran having trouble selling its oil, Venezuela’s production continuing to fall, and the prospect that the civil war in Libya seems likely to reduce its exports. China reported that its massive dose of pump priming appears to have stabilized its economic slowdown for now and Washington keeps talking about an end to the China-US trade dispute.
Oil prices continued to creep up last week closing out at $71.55 in London and $63.89 in New York, making the sixth consecutive week of gains. If you have been watching your gas pumps lately, you have noted that regular is up 30 cents a gallon in the last month to average $2.83 in the US. In California, however, regular is just about $4 a gallon and is going for $4.62 in one county.
Prices have climbed steadily for the last three months closing on Friday above $60 a barrel in New York and $67 in London. The combination of slowing US shale oil drilling and the Venezuela, Iran, and the OPEC+ situations continue to outweigh the bad economic news that may someday lower demand. The situation in Venezuela gets worse every day, and it seems likely that the country will see a significant drop in production and exports during March.