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Tropical Storm Cindy resulted in oil price increase

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Tropical Storm Cindy resulted in oil price increase
June 29
08:00 2017

Today, on June 26, the market is observing the continued growth of oil quotes. The rise has remained for the last five sessions. Today there is a 0.4% increase in the futures price for Brent crude oil with a deadline in August (up to 47.5 US dollars per barrel at 8 am Moscow time). Let’s remind that the given grade of oil is traded on the London stock exchange ICE Futures. Yesterday’s session recorded futures at around 47.31 US dollars per barrel.
Another popular grade of oil – WTI also showed the growth. Thus, the futures price for this grade of oil for August (it is traded on the New York Mercantile Exchange NYMEX) increased to the level of 44.97 US dollars per barrel (at 8 am Moscow time). This is 0.51% more than the closing mark on the results of the previous session.
The rise in oil prices is primarily due to the figures published in the report of the US Department of Energy. It recorded a decline in oil production last week to 9.25 million barrels per day. This is 100 thousand barrels per day less than the figures released in the previous report of the United States Department of Energy.
As for inventory, the figures look as follows: oil reserves increased by 118 thousand barrels (contrary to the forecasted decrease by experts), stocks of distillates dropped by 223 thousand barrels (an increase in inventory was forecasted), gasoline reserves decreased by 900 thousand barrels (the real picture of gasoline stocks coincided with experts’ forecasts).
Experts believe that the rise in oil price, caused by the publication of the decrease in oil production, is temporary because such a reduction is caused not by the will of oil producers, but by force majeure circumstances. And specifically –by the tropical storm Cindy, which brought down its power to the Gulf of Mexico last week.
In general, experts predict the increase in oil production by the United States. This means maintaining a global trend for low prices for oil and oil products.

 

The material was prepared with the participation of  Andrey Majorov,
a leading analyst of the brokerage company CT Trade

 

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