Author: Daniel Lerch

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.