Oil rises on strong demand and tight supply

Fashions of oil barrels and a pump jack are pictured in entrance of a rising inventory chart and “$100” on this illustration taken February 24, 2022. REUTERS/Dado Ruvic/Illustration

Enroll now for FREE limitless entry to Reuters.com

  • Exxon Mobil CEO expects tight oil market to final for years
  • US Secretary of Vitality to Meet with Petroleum CEOs Thursday
  • Biden weighs fuel tax exemption
  • EU leaders will preserve sanctions strain on Russia

HOUSTON, June 21 (Reuters) – Oil costs rose on Tuesday on excessive summer time gas demand, whereas provides remained tight as a consequence of sanctions on Russian oil after its invasion of Ukraine.

Brent crude futures rose 52 cents, or 0.5%, to $114.65 a barrel. US West Texas Intermediate (WTI) crude oil contract for July expired on Tuesday, closing at $110.65, up $1.09, or 1%. Probably the most lively August contract rose $1.53 to $109.52.

Each benchmarks posted a weekly loss final week. For WTI it was the primary weekly loss in eight weeks, for Brent the primary in 5.

Enroll now for FREE limitless entry to Reuters.com

“There are some folks leaping in right here to purchase the underside or what they hope would be the backside of the market,” stated Robert Yawger, director of power futures at Mizuho in New York.

The 50-day easy shifting common of US prior month futures hit its highest degree since 2008, and Brent hit its highest degree since 2013.

Costs gained assist as Exxon Mobil Corp (XOM.N) Chief Govt Darren Woods has forecast three to 5 years of pretty tight oil markets. learn extra

Vitol boss Russell Hardy pointed to inadequate funding and a decline in crude oil manufacturing capability and a tough refining state of affairs. learn extra

US crude and gasoline inventories doubtless fell final week, whereas distillate stockpiles rose, a preliminary Reuters survey confirmed. Weekly stock information is delayed by public vacation on Monday; trade information is due Wednesday at 4:30 p.m. and authorities information is scheduled for Thursday at 11 a.m.

On the demand aspect, UBS analyst Giovanni Staunovo stated that regardless of issues about financial progress, information continues to point out robust oil demand.

“We anticipate oil demand to enhance additional, benefiting from the reopening of China, summer time journey within the northern hemisphere and warming climate within the Center East. With provide progress lagging behind demand progress within the coming months, we proceed to anticipate greater oil costs,” he stated.

The White Home has invited the chief executives of six oil corporations to a gathering Thursday to debate methods to cut back excessive power costs.

On Monday, US President Joe Biden stated a call may very well be made this week on whether or not to pause a federal fuel tax. The US can be in talks with Canada and different allies to additional limit Moscow’s power revenues by imposing a worth cap on Russian oil, Treasury Secretary Janet Yellen stated on Monday. learn extra

The market has been supported by provide anxiousness after sanctions on oil shipments from Russia, the world’s second largest oil exporter, and fears that Russian manufacturing may fall as a consequence of sanctions on gear wanted to the manufacturing.

European Union leaders intention to maintain up the strain on Russia at their summit this week by pledging to maintain engaged on sanctions, a draft doc confirmed. learn extra

“Provide issues are unlikely to abate until there’s a decision to the Russia-Ukraine conflict, or until we see a pointy rise in US or OPEC provide,” Madhavi Mehta stated. commodity analysis analyst for Kotak Securities.

Reuters Charts
Enroll now for FREE limitless entry to Reuters.com

Reporting by Arathy Somasekhar, further reporting by Bozorgmehr Sharafedin in London, Sonali Paul in Melbourne, and Koustav Samanta and Isabel Kua in Singapore Enhancing by Marguerita Choy and David Gregorio

Our requirements: The Thomson Reuters Belief Ideas.

Leave a Comment