MARKET WATCH: Crude prices vacillate on US-China trade conflicts
The light, sweet crude oil price for May gained modestly on the New York market Apr. 3 as did the Brent contract price for June in London, but prices for both crude benchmarks fell Apr. 4 on reports of escalating US-China trade tensions.
Harry Tchilinguirian, BNP Paribas global head of commodity markets strategy, said, “There’s a sea of red on the equity screens, and oil—as a risk asset—is falling as well.”
On Apr. 4, China announced 25% tariffs on certain US exports, including soybeans, airplanes, and automobiles.
Analysts said China’s action was in retaliation to US President Donald Trump’s administration’s threat of additional tariffs beyond recently imposed US tariffs on Chinese steel and aluminum.
Oil prices dropped even after the American Petroleum Institute estimated US crude oil inventories fell by 3.3 million bbl for the week ended Mar. 30.
The US Energy Information Administration was scheduled Apr. 4 to release its weekly oil and product inventory. Analysts surveyed by The Wall Street Journal said they expect crude supplies increased by 1 million bbl for the week ended Mar. 30.
Tchilinguirian said oil traders might focus on US-China frictions and “look past” oil supply levels.
Energy prices
The May light, sweet crude contract on the NYMEX rose 50¢ on Apr. 3 to settle at $63.51/bbl. The June contract gained 47¢ to $63.46/bbl.
The NYMEX natural gas price for May increased more than 1¢ to a rounded $2.70/MMbtu. The Henry Hub cash gas price dropped 2¢ to $2.70/MMbtu on Apr. 3.
Ultralow-sulfur diesel for May increased about 1.5¢ to a rounded $1.99/gal. The NYMEX reformulated gasoline blendstock for May edged up less than 1¢ to remain at a rounded $1.97/gal.
Brent crude oil for June increased 48¢ to $68.12/bbl on London’s International Commodity Exchange. The July contract gained 49¢ to $67.67/bbl. The gas oil contract for April was $613/tonne, unchanged from the previous day.
The Organization of Petroleum Exporting Countries’ basket of crudes for Apr. 3 was $64.98/bbl, down $1.11.
Contact Paula Dittrick at [email protected].
Paula Dittrick | Senior Staff Writer
Paula Dittrick has covered oil and gas from Houston for more than 20 years. Starting in May 2007, she developed a health, safety, and environment beat for Oil & Gas Journal. Dittrick is familiar with the industry’s financial aspects. She also monitors issues associated with carbon sequestration and renewable energy.
Dittrick joined OGJ in February 2001. Previously, she worked for Dow Jones and United Press International. She began writing about oil and gas as UPI’s West Texas bureau chief during the 1980s. She earned a Bachelor’s of Science degree in journalism from the University of Nebraska in 1974.
