Crude futures were seeing small gains while products were trading in the red in the overnight session on Friday, with gains in US stock market index futures and in European equities and a supportive note on global crude oil prices from Goldman Sachs likely supporting, while strength in the US dollar was weighing on the price action. Market participants awaited the US Consumer Sentiment Index, India’s industrial production data, and the weekly US rig counts from Baker Hughes for further direction.
The International Energy Agency said that OPEC+ needs to boost output significantly in order to meet global demand, which is expected to return to pre-pandemic levels in early 2022. Also in the news, Goldman Sachs said that it expects Brent oil prices to climb to $80/bbl this summer, citing that a recent oil market rally will continue as vaccination rollouts across the world continue to boost economic activity.
Asian stock markets closed mixed overnight with the Nikkei down just 0.03% and the Shanghai Composite losing 0.58%, while the Hang Seng closed 0.36% higher. The unemployment rate in Italy rose from 10.0% to 10.4% in the first quarter, while forecasts called for a rise to 10.5%. In UK news, the economy grew 2.3% in April, just missing the 2.4% forecast. Industrial production fell 1.3% in April, while expectations called for a 1.2% increase. On the other hand, the merchandise trade deficit narrowed from -£11.71bn to -£10.96bn, beating forecasts calling for a -£12.2bn figure. As of this writing, the FTSE 100 was up 0.5% and so was the DAX, while the CAC 40 had added 0.7%. US stock market index futures were seeing smaller gains of around 0.15% this morning. In unsupportive news, the US dollar index was up 0.25% as of this writing.
Petroleum futures settled higher yesterday amid gains in US shares and weakness in the US dollar, despite news the US had removed one Iranian official from its sanctions list. Brent crude rose 30 cents to $72.52/bbl and WTI crude added 33 cents, settling at $70.29/bbl. RBOB futures added 97 points to settle at $2.2122/g and ULSD (HO) settled 1.39 cents higher at $2.1434/g. According to Platts, New York Harbor ULSD, HSHO, and ULSHO barge price differentials held steady yesterday at +0.10c/g, -31.75c/g, and -22.75c/g, respectively. June propane prices rose along with crude yesterday. Per Platts, Mt. Belvieu LST prices rose one cent to 95.250c/g and non-LST prices strengthened by 1.250 cents to 95.000c/g. Conway prices added 1.750 cents to average 94.500c/g.
Natural gas futures rose 2.0 cents, settling at $3.149/mmBtu with a tighter US market balance expectation for next week. The EIA reported a 98bcf injection into underground storage for the week ended June 4, matching expectations. Things remain quiet in the Atlantic, with no tropical cyclone activity expected over the next 48 hours, according to the National Hurricane Center.
