The barrel of Brent from the North Sea, for delivery in June, lost only 0.30%, to end at 104.39 dollars.
LOil prices consolidated their positions the day before yesterday and reacted lukewarmly to the commitment of members of the International Energy Agency (IEA) to dip into their strategic reserves. The barrel of Brent from the North Sea, for delivery in June, lost only 0.30%, to end at 104.39 dollars.
In New York, the barrel of American West Texas Intermediate (WTI), with maturity in May, fell 1.00% to 99.27 dollars. This is the first time in over two weeks (March 16) that WTI has closed below $100 a barrel.
The day following US President Joe Biden announced the use of more than 180 million barrels in the next six months, the 30 other IEA member countries promised to also draw on their strategic reserves.
If the agency did not mention a figure, Joe Biden had reported “tens of millions of barrels” in addition to the volumes released by the United States. “These barrels are going to have to come to market,” commented Andrew Lebow, a partner at Commodity Research Group, “and that’s going to take time.”
For the time being, the analyst expects prices to remain high. “The crucial passage, it will be during the month or two months to come”, he warns because “the market is always capable of outbreaks in the very short term”. “We can’t be certain that we won’t reach new heights” in the coming weeks, warns Andrew Lebow.
If talks to find a diplomatic solution to the conflict resumed Friday between Russians and Ukrainians, the head of Ukrainian diplomacy, Dmytro Kouleba, indicated that his counterparts had still not responded to the proposals submitted Tuesday in Istanbul. In addition, the United States and some of the countries of the northern hemisphere are preparing to enter the season for major travel, which corresponds to an acceleration in demand for gasoline, but also for diesel and kerosene.
For Bart Melek, of TD Securities, the use of strategic reserves “may calm short-term concerns regarding tensions, but it does not solve long-term problems”. Supply-side risks remain, he said, from Russia to the lack of additional capacity from the Organization of Petroleum Producing Countries (OPEC), to the trend of general disengagement from the fossil fuel sector, which limits investments.
The member countries of the International Energy Agency (IEA) have decided to draw once more on their strategic oil reserves, but for an unknown volume, in an attempt to lower prices, announced the IEA. The latter confirmed in a press release that its 31 members had decided to draw on their reserves once more, but that the details would be made public “at the beginning of next week”.
The IEA countries had already promised last month to draw some 62.7 million barrels from their reserves, stressing that they had the possibility of going further. They count in total
1.5 billion barrels of reserves.
R. E.
