Crude oil futures prices rose more than 6% on Monday (11th),WTI Crudeand Brent CrudeBoth closed at a one-week high as China slightly eased Shanghai’s lockdown measures to prevent the spread of the virus.
energy commodity prices
- Delivered in May WTI CrudeFutures rose $6.31, or 6.7%, to settle at $100.60 a barrel, closing above $100 for the first time since April 5, following WTI fell 4% on Monday.
- Delivered in June Brent CrudeFutures rose $6.16, or 6.3 percent, to settle at $104.64 a barrel, their highest close in a week.
Brent CrudeFutures settled below $100 on Monday for the first time since March 16.
- Natural gas futures for May delivery rose 0.6% to settle at $6.68 per million Btu.
- Gasoline futures for May delivery rose 5% to close at nearly $3.154 a gallon.
- Delivered in MayThermal Fuel FuturesPrices rose 6 percent to $3.464 a gallon.
market driving force
Crude oil prices have retreated in recent days, ending last week lower for the second week in a row, in part due to the coronavirus lockdown in Shanghai, China, with a population of 25 million.
Reports of shortages of food and other daily necessities have grown in Shanghai as the strict lockdown lengthens, and Shanghai announced on Tuesday that areas with no new positive infections for 14 days would be lifted and restructured as precautionary areas.
Stephen Innes, managing partner at SPA Asset Management, said the news helped ease concerns regarding Chinese oil demand, offering “a ray of light at the end of the tunnel.”
However, “the oil bulls also folded their hands and prayed that the light was the light of another Chinese epidemic prevention train driving into the tunnel.”
The Organization of the Petroleum Exporting Countries (OPEC) lowered its forecast for oil demand growth in 2022 by 500,000 bpd in its monthly report on Tuesday.bringing it down to 3.7 million bpd, saying the move “mainly reflects OPEC’s downgrade of its economic outlook for 2022.”
in addition,The U.S. Energy Information Administration (EIA) lowered its forecast for global oil and liquid fuel consumption on Tuesdayconsumption is currently estimated to average 99.8 million barrels per day in 2022, down 800,000 barrels from the March estimate.
EIA Ya tune down WTI Crudeand Brent Crude 2022 price forecasts, but revised up 2023 price forecasts for both benchmark oils.
Meanwhile, the release of strategic reserves announced last week by the United States and other countries has also been cited as a factor in the recent pullback in crude prices.
The Biden administration plans to allow the sale of gasoline with high ethanol content during the summer to help reduce high fuel prices, senior administration officials said. The decision will allow gasoline with 15% ethanol to be sold from June 1 to September 15 (normally only 10% ethanol blends are allowed during this period to reduce smog).
Natural gas futures extended gains to more than 13-year highs as swathes of the northern U.S. and southern Canada endured a long winter, Rystad Energy senior analyst Vinicius Romano reported.
“Rising domestic demand and export demand from Europe has pushed U.S. stocks to below-average levels at this time of year, supporting prices.”
The EIA monthly report on Tuesday predicted that the average price of natural gas in the United States in 2022 will be $5.23 this year, up 32% from the March forecast, and the United States’ annual liquefied natural gas exports may average 12.2 billion cubic feet per day, an increase of 25% from 2021.
The EIA is due to release last week’s oil supply report on Wednesday. According to a survey by S&P Global Commodity Insights, analysts, on average, forecast an increase of 300,000 barrels of crude oil inventories last week (4/8), a drop of 800,000 barrels of gasoline inventories, and a drop of 1.5 million barrels of distillate inventories.
