Futures rose towards $73 a barrel on Friday as refineries in Louisiana restarted and returning offshore production could not keep pace. About two-thirds of the US Gulf’s offshore oil production or about 1.2 million b/d has remained offline since late August. As a result, US crude inventories fell to the lowest since September 2019. The storm that hit the US Gulf of Mexico so far has removed more than 21 million barrels of crude from the market. Over 1.68 billion cubic feet per day of natural gas were also off-line on Friday, while a total of 65 platforms and three rigs continued to be evacuated.
Damages to oil production facilities in the US Gulf of Mexico kept output largely halted a week after Hurricane Ida made landfall, according to offshore regulator the Bureau of Safety and Environmental Enforcement. Energy companies have been coping with damaged platforms and onshore power outages and logistical issues, slowing efforts to restart production. Some 88% of crude oil output and 83% of natural gas production remained suspended. About 1.6 million barrels of crude oil remained offline, with only about 100,000 barrels added since Saturday. Another 1.8 billion cubic feet per day of natural gas output also was shut in.
Prices advanced as hurricane Ida shut off some 59% of Gulf of Mexico crude production. At the same time, the Federal Reserve reinforced its support to begin tapering stimulus by the end of the year. Futures in New York rose 2% on Friday to post the biggest weekly gain in more than a year. Federal Reserve Chair Powell said the central bank could begin reducing its monthly bond purchases this year, though it won’t be in a hurry to start raising interest rates after that. Some 49% of Gulf natural gas production was also shut ahead of the storm. The Gulf accounts for roughly 17% of the nation’s oil production, totaling about 1.7 million b/d, and 5% of its dry gas production.
Last week ended with the longest losing streak since 2019 as the dollar strengthened after the Federal Reserve signaled it would start tapering stimulus and the virus resurgence raises doubts about demand growth. West Texas Intermediate futures closed Friday 2.2% lower, tumbling for the seventh day, and extending the week’s decline to 8.9%. The pandemic remains a threat to energy demand, especially across Asia, with China restricting mobility to combat an outbreak.
While global crude demand remains on an uneven upswing, the rapid spread of the coronavirus delta variant has dented most demand projections for the rest of 2021. Asian outbreaks, especially in China, are triggering new economic restrictions. China’s zero-tolerance approach to COVID-19 led to the closure of its Meishan terminal at the world’s third-busiest port — the Ningbo-Zhoushan port — which is expected to disrupt supply chains globally. WTI lost 65 cents, down to a $68.44 settlement for the week, while front-month Brent closed at $70.59. The spread of the delta variant of Covid is threatening to put an early end to the US summer driving season and spark a more precipitous downturn than usual in gasoline demand following the Labor Day holiday in early September.
Futures in New York rose 0.2% last week, completely recouping a selloff on Monday that was stoked by the rapidly spreading delta variant. Fuel demand and road traffic from the US to Asia and Europe remains resilient, underscoring expectations that the recovery hasn’t been derailed and global inventories will continue to shrink. New York futures settled at $72.07 while Brent settled at $74.10.
Prices declined the most last week since March as a resurgence of Covid-19 threatened the outlook for near-term global fuel consumption. Futures in New York settled at $71.81, 3.7% lower for the week. Brent ended the week at $73.59, down about 2.6% for the week. Despite the pullback, crude has surged nearly 13% over the last three months as a global vaccine rollout helps restore economic activity. Moreover, forecasters ranging from the International Energy Agency to Citigroup predict that the market will get tighter in the coming months.
Prices fell last week for the first time since May after days of volatile trading in the wake of OPEC+’s stalemate over a production increase. Futures in New York declined 0.8%, although the US crude benchmark closed higher on Friday amid a broader market rebound. Prices whipsawed during the week amid ambiguity over the future of the OPEC+ alliance and swings in the US dollar. However, Brent prices remained about $3 a barrel below Monday’s close, as traders remained worried that global crude supplies might swell following the collapse of OPEC+ negotiations.
Futures posted their sixth straight weekly gain, the longest winning streak since December, as the standoff between OPEC+ ministers over output dragged on. New York prices rose 1.7% last week, closing at $75.16, with London closing at $76.17. Most members of the OPEC alliance backed a proposal to increase supply and extend the deal into later next year, but the United Arab Emirates remains opposed.
Prices posted their fifth straight weekly gain, the longest winning streak since December, as demand recovers and supplies continue to tighten in the US and China. Futures in New York rose 3.4% last week to the highest level since October 2018. Demand continues to rebound while the market expects output will only get a modest increase from the OPEC+ alliance, which meets this week to discuss supply policy.
Prices posted a fourth straight weekly gain as signs of a global demand recovery and supply discipline among producers encouraged investors. Futures in New York rose 1% last week. Strong US demand growth is being passed on to Europe and emerging markets, where India is also starting to show improvements.
Crude posted its third straight weekly rise on improving demand, with the International Energy Agency warning the market will need extra supply next year. New York futures rose 1.9% last week, extending their rally to the highest settlement since October 2018. The IEA said that OPEC and its allies would need to lift output to keep the market adequately supplied, though the agency predicted demand wouldn’t reach pre-virus levels until late 2022. Meanwhile, road traffic in the US and much of Europe is essentially back to levels seen before the pandemic.
Futures rose towards $72 a barrel on Friday, trading close to a two-year high as OPEC+ supply discipline and recovering demand countered concerns about the pace of the COVID-19 vaccination rollout around the globe. Brent crude settled at $71.89 a barrel after touching $72.17, its highest since May 2019. The session high for West Texas Intermediate was $69.76, its highest since October 2018. OPEC and allies said they would stick to agreed supply restraints. US crude oil inventory declines extended in the week ended May 28th amid rising refinery demand and lower production.
It was a historic week for the oil industry, potentially marking a turning point, at least for the corporate strategies of the oil majors. More curbs on the supply side added some bullish sentiment to the market, although the impacts on the fundamentals are not necessarily going to unfold in the near term. But in the wake of the enormous legal and corporate governance blows to the oil majors, more than a few analysts spoke about growing odds of a supply crunch in the years ahead. Royal Dutch Shell lost a landmark legal case in a Dutch court, which, if it stands, will require 45% cuts in GHG emissions by 2030. The case is seen as a warning sign for the rest of the oil industry, signaling legal exposure to emissions.
Prices had their worst week in at least a month as the market contends with a potential deal that could lift US sanctions against Iranian crude. WTI futures in New York rose the most since mid-April on Friday, tracking a broader market rally that buoyed prices during most of the trading day. Nonetheless, crude benchmarks couldn’t shake off the specter of millions of barrels a day of Iranian crude returning to the market, with Brent futures in London posting the most significant weekly decline since March.
Prices have been stuck in a range lately, with optimism around global inventories rebalancing being offset by constant reminders that parts of the world remain far from a full recovery from the pandemic. The International Energy Agency said last week that the global glut that built up last year has cleared. However, the agency also lowered its demand estimates due to the virus’ resurgence in India.
The struggle between the spreading pandemic in the less developed world and the revival of economic activity in the US, Europe, and China continues to keep prices volatile as they move steadily higher. Last week, futures posted another gain as expectations for growing economic activity in the US and Europe fueled optimism around more robust summer demand, with New York prices advancing 2.1%. Fuel sales in the UK rose to the highest since the pandemic began, and in the US, refineries are running at their highest rate since the pandemic began as they gear up for the summer driving season. Declining crude inventories and progress in reopening the US economy are boosting oil prices.
Prices rose last month with much positive economic data and signs of a fuel consumption revival in key economies offsetting a worsening coronavirus crisis elsewhere. Futures in New York rose last week, extending their monthly gain to 7.5%. The near-certain likelihood of higher fuel consumption in the US, China, and the UK has brightened the overall demand outlook, even as a resurgent pandemic in India, Brazil, and Japan cloud those prospects. OPEC and its allies see world consumption rebounding by 6 million b/d this year, while Goldman Sachs says demand could post a record jump as vaccination rates increase.
Prices fell last week with spreading coronavirus cases in countries such as India tempering optimism around positive signs out of the US and Europe. Futures in New York rose the most in over a week on Friday but were unable to reverse a 1.6% weekly loss as the market weighed a global economic reopening that’s coming in fits and starts. The unprecedented oil inventory glut that amassed during the coronavirus pandemic is almost gone, underpinning a price recovery that’s rescuing producers but vexing consumers. Barely a fifth of the surplus that flooded into the storage tanks of developed economies when oil demand crashed last year remained as of February, according to the IEA.
Last week, oil prices saw their biggest weekly gain since early March as signs emerged of a recovery from the pandemic gaining traction in the US and China. Futures in New York advanced 6.4% last week, despite eking out a slight loss on Friday. On the heels of robust economic figures out of the US, data from China showed its gross domestic product climbed 18.3% in the first quarter from a year prior as consumer spending beat forecasts. In March, China’s refiners processed about 20% more crude than a year earlier, pointing to the strength of the country’s rebound. JPMorgan analysts forecast that Brent would hit $70 again, with a boost in US demand likely bringing OECD inventories back to normal sooner than expected.
The markets posted their worst week since mid-March amid concerns that rising global coronavirus cases slowed economic recovery. West Texas Intermediate futures ended the week down 3.5% to close at $59.32. Brent closed at $62.95. With the OPEC+ countries planning to raise output by some 2 million b/d in May and June, markets now are focused on whether the demand recovery will be enough to absorb growing supplies. While consumption is climbing in India and the US, rising virus cases and stricter travel limits in Europe are muddying the forecast and putting pressure on crude prices.
West Texas Intermediate and Brent crude futures posted solid increases on Thursday after OPEC+ decided to increase production slowly. WTI for May delivery gained $2.29 to $61.45 per barrel. June Brent futures closed at $64.86/barrel, up $2.12. Oil futures received a boost from the OPEC+ group of significant producers’ decision to increase output from May to July.
Prices were volatile last week as the grounding of the “Ever Given” container ship in the Suez Canal set off a chain of events that wreaked havoc on global trade. On Tuesday last week, Brent crude’s price plunged to $60.86 per barrel from $69.63 per barrel on March 11th. The price had rebounded to nearly $64 per barrel by Wednesday. The dramatic price fluctuations are attributable to various events, including US oil inventory figures, another round of lockdowns in the EU, AstraZeneca vaccine safety and efficacy concerns, and the vessel stuck in the Suez Canal. On Friday, the markets closed essentially unchanged for the week at $60.97 in New York and $64.57 in London. Prices are up roughly 25% this year, and there’s confidence in the longer-term outlook as vaccination rates climb, and OPEC+ keeps supply in check.
On Thursday, prices suffered their biggest weekly fall since October as signs of flagging demand in key markets halted a strong rally. International benchmark Brent crude ended the week down almost 7%, settling at $64.53 a barrel. West Texas Intermediate, the US marker, fell by a similar margin to $61.42 a barrel. Oil futures are still up well over 20% since the start of the year, with the world’s largest oil producers reining in supply and travel around the world still slow.
Prices settled near $70 a barrel on Friday, supported by production cuts by major oil producers and optimism about a demand recovery in the second half of the year. Benchmark Brent settled at $69.22 a barrel. US West Texas Intermediate crude ended at $65.61 a barrel. Brent and US crude finished the week roughly flat after prices touched a 13-month high on Monday, following seven straight weeks of gains.