Economy

USA crude strengthens as certain stimulus measures to continue

USA crude strengthens as certain stimulus measures to continue”

With open interest in June futures at a fraction of later months and US storage facilities no longer full to the brim, a repeat of the collapse that sent the front-month West Texas Intermediate contract to nearly $40 a barrel below zero looked unlikely.

The price of futures contracts for West Texas Intermediate (WTI) crude with delivery in July surged to over $30 per barrel in the early hours of Monday for the first time since 17 March, market data shows.

"With declining concerns of hitting tank tops, the likelihood of going below zero in the near term is close to zero", said Giovanni Staunovo, commodity analyst at Swiss bank UBS.

The American Petroleum Insitute (API) reported that United States crude inventories fell by 4.8 million barrels for the week ended May 15.

Production is also falling as US energy firms cut the number of oil and natural gas rigs operating.

The world's top exporter Saudi Arabia announced last week that it would cut an additional one million barrels per day in June, while OPEC+ wants to maintain existing oil cuts beyond June when the group is next due to meet.

UBS expects the spread of Brent and WTI to average around $3 per barrel over the coming months.

More news: Grimes' mother appears to slam Elon Musk over 'bulls--t' tweet

The demand recovery is "positive pretty much across the board", Stewart Glickman, energy equity analyst at CFRA Research in NY.

"Where you've seen cases of individual companies that have reported positive early stage results as it pertains to any kind of vaccine, that's been received very well", Will Rhind, chief executive officer at GraniteShares, said in a phone interview.

Global equity markets also rallied yesterday as news of a possible vaccine lifted sentiments.

Refiners are pinning hope on easing of lockdowns boosting gasoline demand. Meanwhile, China- a major oil consumer - saw activity pick up as well.

"China, the first country sucked into and reeling out of the corona crisis, is experiencing excessive traffic congestion again, in part because public mass transport remains out of favour", he added.

Global economic woes negate demand optimism. Exports have fallen by 6.4 million barrels a day so far this month, it said. The IEA had previously forecast a decline of 9.3m bpd for 2020.



Like this

loading...
loading...

Latest


20 May 2020
World carbon pollution falls 17% during pandemic peak
Additionally, the overall level of emissions reduction will be dependent on the degree to which activity returns back to "normal". It then estimated the change in fossil Carbon dioxide emissions for each day and country from January to April.

20 May 2020
Captain Tom To Receive Knighthood For NHS Fundraising
He hailed the centenarian as a "national treasure" but did not say when he would receive the honour. He had risen to the rank of captain throughout his navy profession throughout World War II.

20 May 2020
Trump Calls into NBC Golf Broadcast: ‘We Want to Get Sports Back’
Trump didn't address McIlroy's comments directly on Sunday, opting to celebrate his and his fellow golfers' return to the course. Trump pivoted away from those remarks, saying (via golf.com ), "A lot of [Tour pros] are very political, actually".

20 May 2020
Xiaomi MIUI 12 global launch set for today
After that, phones will update to MIUI 12 on a model-by-model basis, although we haven't been told which phones or how frequently. The MIUI 12 comes with Dark Mode 2.0, which will allow users to dim wallpapers and adjust font so that its easy on the eyes.

20 May 2020
After 32 years, Chinese couple reunited with abducted son
The method of kid trafficking for prohibited fostering is not unusual in China and also has a lengthy background. Mao Zhenjing last saw his son outside the entrance of a hotel in Xi'an they stopped at to get some water.

20 May 2020
Israeli court convicts Jewish extremist in arson that killed Palestinian family
A second, underage defendant in the case entered a plea deal a year ago in which he was convicted as an accessory. Ben Uliel was also found guilty of attempted murder, but was acquitted of belonging to a terrorist organisation.

20 May 2020
Apple Glass expected to start at $499 with Prescription Lens Support: Prosser
Like when the Apple Watch was first revealed, there will be a period of about 6-9 months before general release. That's just for the frames though, so if you need prescription lenses you'll need to pay extra for that.

20 May 2020
Italy reopens churches with new rules to stay safe from coronavirus
As Pope John Paul II, he is credited with playing a key role in thwarting communism in his native country and all of Europe. "John Paul II is not the moral rigourist" some people have portrayed him as being, the retired pope wrote.

20 May 2020
Changed my batting stance to score all over ground: Virat Kohli
In fact Kohli lost his father at the age of 18, when the latter was playing a Ranji Trophy match for Delhi against Karnataka. Now I think about how nice it would be if I could have given my father the peaceful retired life he deserved.

20 May 2020
La Loche Health Centre long term care outbreak declared over
Saskatchewan has 152 active cases, with over 83 per cent of them being in the far north, which has 127 active cases. The latest Saskatchewan Health numbers show another day with only one new COVID-19 case and several recoveries.