News summary
Demand expectations boost oil pricesJungleJackpotQuestCrude oil prices rebounded from a three-month low as the driving season approaches in the United States; oil prices on the New York Mercantile Exchange and the London Intercontinental Exchange both rose slightly.
Newsletter text
[Market recovery shows signs, international oil prices rebound from low levels] Driven by peak demand before the long holiday, traders are cautious about shorting. International oil prices recovered their losses on Friday after falling for four consecutive days. New York Commodity Futures Exchange July futures settlement price of West Texas Light crude oil climbed to 77 per barrelJungleJackpotQuestAt US$.72, Brent crude also rose, closing at US$82.12 a barrel. Due to the start of the U.S. summer driving season, gasoline demand is expected to heat up. West Texas Light crude and Brent crude both hit intraday lows in several months, at US$76.15 and US$80.65 per barrel respectively. Data provided by the American Motorists Association AAA showed that before the Memorial Day weekend, the national average price at gas stations was about $3.61 a gallon. Although slightly lower than the previous month, it was still up year-on-year. The U.S. Department of Energy plans to sell 1 million barrels of gasoline from Northeast gasoline reserves by July 4 to calm price fluctuations, reflecting the government's high focus on energy market fluctuations. The market strategies of OPEC and its production reduction allies have attracted much attention from the market. Their video conference on June 2 may decide on the continuation of the production reduction policy. Currently, the production reduction is about 2.2 million barrels per day, and the market generally expects that the production reduction period will be extended. Although OPEC's production reduction policy has triggered supply concerns, analysts at oil broker PVM pointed out that macroeconomic development has failed to provide strong support for the oil market, and the problem of oversupply has not yet been resolved. According to data from the International Energy Information Administration, the daily crude oil output of OPEC and its 22 member countries to reduce production in April totaled 41.43 million barrels, with remaining production capacity of approximately 5.9 million barrels. The output of some member countries exceeded the quota. Although oil prices rebounded on Friday, overall market concerns that high U.S. interest rates could curb demand growth and inventory reports showed different signals made traders uneasy about the near-term prospects for crude oil. Baker Hughes data shows that the number of active oil drilling rigs by U.S. energy companies has stabilized, while the number of natural gas drilling platforms has decreased, reflecting the industry's strategic adjustment to resource extraction.
