International oil prices rose for the third consecutive day on Wednesday (20th), boosted by tensions in the Red Sea that disrupted global trade. Meanwhile, U.S. official data showed that domestic supplies of crude oil and petroleum products increased last week.
energy commodity prices
- 2 West Texas Intermediate (WTI) crude futures for delivery rose 28 cents, or 0.4%, to settle at $74.22 a barrel.
- Delivered in FebruaryBrent crude oil (Brent) futures were up 47 cents, or nearly 0.6%, at $79.70 a barrel, but off the session high of $80.60.
WTI crude oiland Brent crude oilBoth hit their highest closing prices since November 30.
- Gasoline futures for January delivery were flat at $2.20 a gallon.
- Delivered in JanuaryThermal Fuel FuturesPrices fell 0.3% to settle at $2.71 per gallon.
- Natural gas futures for January delivery fell 1.8% to settle at $2.45 per million Btu.
Red Sea Shipping Dilemma
Since the outbreak of the Israel-Kazakhstan war, the Houthi rebels who mainly control Yemen have launched a series of drone and missile attacks, leading several shipping companies to announce that they will suspend transportation to avoid attacks.
Phil Flynn, senior market analyst at Price Futures Group, said that the Houthi rebels’ actions to disrupt international shipping lanes are not only an act of war, but also an attack on the global economy. While the United States is building an international coalition to stop piracy, “the question becomes whether they will go after Iran.”
The United States on Tuesday announced the launch of an international naval operation to stop the attack.
“This is a wake-up call for the oil trade. Last month the market thought there was no need for a premium on oil because of the war, but now the war premium is being forced back into the price,” Flynn said.
However, XM senior investment analyst Marios Hadjikyriacos believes that against the backdrop of slowing demand next year and record high U.S. crude oil production, current market concerns about global trade disruptions may not be able to support oil prices in the long term.
supply data
U.S. crude, gasoline and distillate supplies all climbed last week, according to the U.S. Energy Information Administration (EIA), while U.S. oil production once again hit a record high, according to EIA data dating back to 1984.
The EIA announced on Wednesday that U.S. commercial crude oil inventories increased by 2.9 million barrels last week (ending December 15).
According to a Wall Street Journal survey, analysts on average expected U.S. crude oil inventories to increase by 2.5 million barrels last week. According to sources, the American Petroleum Institute (API) announced late Tuesday that crude oil inventories increased by 939,000 barrels last week.
The EIA report also showed gasoline supplies increased by 2.7 million barrels and distillate supplies increased by 1.5 million barrels. Analysts had forecast an increase of 700,000 barrels each in gasoline and distillate supplies.
The EIA said that crude oil inventories in Cushing, Oklahoma (the New York Mercantile Exchange delivery center) increased by 1.7 million barrels last week. At the same time, U.S. oil production increased by 200,000 barrels per day last week, setting a daily production record of 13.3 million barrels. .
2023-12-20 21:40:09
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