The light, sweet oil prices for August and September delivery each climbed more than $1.50/bbl on June 28 as traders and analysts switched their focus to world crude oil supplies after having fretted for the previous three sessions about the aftermath of the UK’s vote to leave the European Union.
Meanwhile, the US Energy Information Administration was scheduled June 29 to release its weekly government oil and product inventory for the week ended June 24.
Additional support for oil prices came from labor unrest in Norway, one of Europe’s biggest oil producers. As many as 7,500 oil and gas workers have threatened to strike starting July 2 unless a new wage agreement is reached July 1.
Norway produced 1.96 million b/d during May, the International Energy Agency said.
PIRA Energy Group said Britain’s vote to exit—Brexit—the EU will have little or no effect on global oil demand in 2016 and could reduce it by 100,000-200,000 b/d in 2017 due to slower European economic growth.
Gary Ross, PIRA Energy head of global oil, told the Wall Street Journal that he still expects “the fundamental rebalancing of the market and the continued likely improvement in price.”
He said Brexit “just slows it down a little bit.”
Separately, media reports indicated Nigerian oil production was resuming as the government implements a ceasefire agreement with militants in the Niger Delta region. There have been no reports of militant attacks on oil pipelines since June 16.
The natural gas contract for July jumped 20¢ to close at a rounded $2.91/MMbtu. The Henry Hub, La., gas price was $2.86/MMbtu, rising 10¢.
Heating oil for July delivery gained 4¢ to a rounded $1.47/gal. The price for reformulated gasoline stock for oxygenates blending for July was up 3¢ to a rounded $1.51/gal.
The August Brent crude contract on London’s ICE gained $1.42 on June 28 to $48.58/bbl. The contract for September rose $1.49 to $49.26/bbl. The July gas oil contract rose $7.25, settling at $428.50/tonne.
The average price for the Organization of Petroleum Exporting Countries’ basket of 12 benchmark crudes on June 28 was $44.46/bbl, up 14¢.
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