Light, sweet crude prices settled at $44.66/bbl on the New York market on May 6, up modestly, as analysts monitored wildfires in Canada’s oil sands region and also noted statistics showing strong Chinese crude oil imports.
During the weekend, Saudi Arabia appointed Khalid al-Falih, chairman of Saudi Aramco, as the Saudi oil minister, succeeding Ali al-Naimi. Analysts were uncertain what the Saudi oil ministry shuffle might mean for long-term oil prices.
Analysts agreed uncertainty about Canada’s near-term oil production will be a main driver for oil prices this week.
Announcements from oil sands producers showed the fires to have caused at least 645,000 b/d in production to be taken off the market, but the total figure is believed higher because not all operators have announced fire-related production figures yet.
“This production isn’t gone for good, yet when fires are controlled, restarting production will take several more weeks, even without damage,” Morgan Stanley said in a research note.
Barclays Commodities Research issued a May 9 research note saying China’s net oil imports remained firm.
“In volume terms, crude oil net imports were 8.3% higher year-over-year, which was the second highest level on record,” Barclays said. China crude oil imports during April were 7.9 million b/d, up 335,000 b/d from March. The highest monthly import rate on record was 8.02 million b/d during February.
Barclays analysts said China’s imports could be lower in May because of logistical bottlenecks and refinery maintenance schedules.
The NYMEX natural gas contract for June gained 2.5¢ to $2.10/MMbtu. The Henry Hub price was $1.84/MMbtu, down 20¢.
Heating oil for June delivery edged up less than a penny to a rounded $1.34/gal. The price for reformulated gasoline stock for oxygenates blending for June gained a rounded 0.5¢ to remain at a rounded $1.49/gal.
The Brent crude contract for July on London’s ICE was up 36¢ to $45.37/bbl. The August contract gained 41¢ to $45.86/bbl. The May gas oil contract was $400/tonne, up $1.25.
The Organization of Petroleum Exporting Countries basket of crudes was $40.55/bbl, down 60¢.
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