Tuesday, July 23, 2024

Crude oil prices rose 1%, with Brent near $78 a barrel


Crude oil prices rose more than 1% during trade today, Wednesday, May 24 (2023), to reap a third consecutive session of gains amid supply shortage fears.

It comes after a decline in U.S. oil stocks and fuel supplies, and Saudi Energy Minister Prince Abdulaziz bin Salman warned speculators of possible further OPEC+ production cuts.

Crude oil price today

At 06:59 a.m. GMT (09:59 a.m. Mecca time), benchmark Brent crude futures — for delivery in July 2023 — rose about 1.08% to $77.67 a barrel.

At the same time, US West Texas Intermediate crude futures – for July 2023 delivery – rose 1.25% to $73.82 a barrel, as seen by the specialized energy site.

Crude oil prices ended yesterday’s trade yesterday, the second day in a row, with an increase of more than 1% on Tuesday, May 23, in light of a seasonal increase in demand for gasoline, supported by investors’ expectations of controlling the market. .

Saudi Energy Minister’s Warning

“Crude oil prices are starting to rise after Saudi threats to short sellers,” said Edward Moya, senior analyst at OANDA, adding that Saudi Arabia “will do whatever it takes to protect prices.”

A crane in an oil field in Argentina – Photo credit: Reuters

Concerns about supply pressures rose days before a scheduled meeting of the OPEC+ alliance to decide future oil policy after Saudi Energy Minister Prince Abdulaziz bin Salman warned against oil speculators.

Prince Abdulaziz bin Salman said in his speech during the Qatar Economic Forum yesterday, Tuesday: “Speculators – as in any market – will continue. I keep telling them that they will suffer. They suffered in April. I do. I don’t have to publish my documents, but I I will only tell them to beware.

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Some investors took this as a sign that the Organization of the Petroleum Exporting Countries (OPEC) and allies including Russia, known as the OPEC+ alliance, may consider further production cuts at their June 4 meeting.

CMC market analyst Tina Deng said crude oil prices rose amid speculation that the OPEC+ alliance may cut production further to maintain price stability. Reuters.

US oil stocks

Crude oil prices got a boost late on Tuesday from industrial data that showed U.S. crude oil and fuel stockpiles fell sharply.

U.S. oil inventories fell by about 6.8 million barrels in the week ended May 19, citing figures from the American Petroleum Institute.

Gasoline stocks also fell to about 6.4 million, and distillate stocks fell to about 1.8 million, according to data seen by the energy specialist site.

U.S. gasoline stocks fell for a third week in a row and will be at their lowest level since 2014 if data released by the Energy Information Administration — due to be announced on Wednesday — confirm the U.S. Petroleum Institute’s numbers.

“If this is confirmed by the EIA report, we may start to see some recessionary fears,” said OANDA analyst Edward Moya.

The Memorial Day holiday in the US, on May 29 this year, marks the start of the summer travel peak in the US.

Elsewhere, markets remained jittery over the US debt ceiling debate, which pared gains in crude oil prices.

Another round of debt ceiling negotiations ended with signs of progress on Tuesday, as a deadline to raise the government’s $31.4 trillion debt ceiling or reduce the risk of default loomed.

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Nadia Barnett
Nadia Barnett
"Award-winning beer geek. Extreme coffeeaholic. Introvert. Avid travel specialist. Hipster-friendly communicator."

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