Oil Prices Set For Weekly Loss as War Premium Evaporates

The New Diplomat
Writer

Ad

The Need for Nigeria to Lead Africa in the Emerging Age of Artificial Intelligence

By Sonny Iroche Introduction: Standing at the Threshold of the Fourth Industrial Revolution The world is on the cusp of a seismic transformation driven by Artificial Intelligence (AI). Just as steam engines powered the first Industrial Revolution, electricity and mechanization the second, and digital computing the third, AI is the defining force of the Fourth…

Why Wike Should Resign or Be Sacked: A Call to Organized Civil Society in Nigeria to Uphold Anti-corruption Standards with Consistency, By Frank Tietie

By Frank Tietie The revelations by Nigerian social crusader, investigative journalist, and activist Omoyele Sowore regarding the current Minister of the Federal Capital Territory, Nyiesome Wike, are serious and warrant the attention of all Nigerians who care about the integrity of the country. Sowore has alleged that Wike laundered funds and concealed the purchase of…

Dangote Refinery Slams PENGASSAN, Describes Order as ‘Economic Sabotage’

By Abiola Olawale In an escalating labor showdown, the Dangote Petroleum Refinery has fired back at the Petroleum and Natural Gas Senior Staff Association of Nigeria (PENGASSAN), criticising the latter’s order on Saturday. This is as the refinery owned by Africa’s richest person, Alhaji Aliko Dangote described PENGASSAN's order to cut crude oil and gas…

Ad

  • Crude oil prices are on track for a weekly decline as reduced geopolitical tensions in the Middle East ease fears of supply disruptions.
  • Despite recent draws in US crude and fuel inventories, the market’s focus is shifting to potential tariff removals and the upcoming OPEC+ meeting in early July.
  • Analysts anticipate that increased OPEC+ production could lead to a significant oil market surplus by the end of the year, assuming continued regional stability.

Crude oil prices were set to end the week lower than they started it as Israel and Iran stopped bombing each other, alleviating fears of a supply disruption in the Middle East.

At the time of writing, Brent crude was trading at $68 per barrel, with West Texas Intermediate at $65.55 per barrel. That’s down from over $77 for Brent crude and $73 per barrel for WTI at the end of last week.

Still, both benchmarks inched higher on Thursday this week, after the U.S. Energy Information Administration reported a draw in both crude oil and fuel inventories, and signs of strengthening demand and a ramp-up in refining activity.

“The market is starting to digest the fact that crude oil inventories are very tight all of a sudden,” Phil Flynn, an analyst from Price Futures Group, told Reuters.

ING analysts, meanwhile, noted that now that the risk of a Middle Eastern supply disruption was off the table, focus would return to tariffs. The U.S. is due to finalise trade agreements with 10 countries after reaching a deal with China earlier in the month. If the other ten deals are successful, which will likely be the case, the tariff threat will also be removed from the oil market, which may provide a boost for demand and, consequently, prices. A cheaper U.S. dollar should also help. The greenback slumped this week on reports President Trump was going to make his Fed chair pick early.

Besides the tariff business, ING also noted OPEC+’s next meeting, due to be held on July 6, which the bank’s analysts expect will result in yet another 411,000-bpd production boost. “These supply hikes should ensure that the oil market moves into a large surplus towards the end of the year. This assumes we don’t see a re-escalation in the Middle East, which would lead to supply losses,” Warren Patterson and Ewa Manthey wrote.

Crude oil prices are on track for a weekly decline as reduced geopolitical tensions in the Middle East ease fears of supply disruptions.

Despite recent draws in US crude and fuel inventories, the market’s focus is shifting to potential tariff removals and the upcoming OPEC+ meeting in early July.

Analysts anticipate that increased OPEC+ production could lead to a significant oil market surplus by the end of the year, assuming continued regional stability.

Oil rig

Crude oil prices were set to end the week lower than they started it as Israel and Iran stopped bombing each other, alleviating fears of a supply disruption in the Middle East.

At the time of writing, Brent crude was trading at $68 per barrel, with West Texas Intermediate at $65.55 per barrel. That’s down from over $77 for Brent crude and $73 per barrel for WTI at the end of last week.

Still, both benchmarks inched higher on Thursday this week, after the U.S. Energy Information Administration reported a draw in both crude oil and fuel inventories, and signs of strengthening demand and a ramp-up in refining activity.

“The market is starting to digest the fact that crude oil inventories are very tight all of a sudden,” Phil Flynn, an analyst from Price Futures Group, told Reuters.

ING analysts, meanwhile, noted that now that the risk of a Middle Eastern supply disruption was off the table, focus would return to tariffs. The U.S. is due to finalise trade agreements with 10 countries after reaching a deal with China earlier in the month. If the other ten deals are successful, which will likely be the case, the tariff threat will also be removed from the oil market, which may provide a boost for demand and, consequently, prices. A cheaper U.S. dollar should also help. The greenback slumped this week on reports President Trump was going to make his Fed chair pick early.

Besides the tariff business, ING also noted OPEC+’s next meeting, due to be held on July 6, which the bank’s analysts expect will result in yet another 411,000-bpd production boost. “These supply hikes should ensure that the oil market moves into a large surplus towards the end of the year. This assumes we don’t see a re-escalation in the Middle East, which would lead to supply losses,” Warren Patterson and Ewa Manthey wrote.

Credit: Oilprice.com

Ad

Unlocking Opportunities in the Gulf of Guinea during UNGA80
X whatsapp