US crude prices dip from seven-week high
PUBLISHED
2024-07-08
Content
US crude prices eased off a seven-week high at Friday’s close, despite robust summer demand.
West Texas Intermediate crude for August delivery closed down 44 US cents to settle at $83.44 per barrel, while September Brent crude, the global benchmark, was down 32 cents at $86.36 a barrel.
An easing in fears about damage to production facilities from the first storm of the northern summer saw prices sag. Hurricane Beryl has been downgraded to a tropical storm after coming ashore along Mexico's Yucatan Peninsula.
Beryl was expected to make landfall near the Texas and Mexico border Sunday evening or early Monday. However, Beryl is the most powerful storm to ever form in June, raising fears of an active and destructive hurricane season in the coming months that could disrupt Gulf of Mexico production.
"Hurricane Beryl raises concerns of a supercharged storm season disrupting production and the flow of crude and fuel products to and from the Gulf of Mexico. Together with heightened geopolitical risks, these developments have offset signs of demand weakness in Asia," Saxo Bank noted in its usual end-of-week note.
Despite Friday's drop, oil prices are up around 13% in the past month due to rising demand during the US summer driving season, falling American oil inventories (down 12.2 million barrels in the latest week), and continuing tensions in the Middle East driving prices.
Friday’s rig use report was mixed: no change in oil rig numbers for the first time in seven weeks, but a strong rise of four in the number of gas rigs, in a week where US gas prices fell to seven-week lows.
The number of oil rigs in use in the US held steady at 479 last week, according to data from energy services company Baker Hughes. The tally for gas rose by four to 101, while miscellaneous rigs were unchanged at five. Overall, 585 rigs were operating in the US this week, down from 680 a year earlier.
A year earlier, the US had 540 oil, 135 gas, and five miscellaneous rigs in operation, company data showed.
Author
| Name | Glenn Dyer | Glenn Dyer has been a finance journalist and TV producer for more than 40 years. He has worked at Maxwell Newton Publications, Queensland Newspapers, AAP, The Australian Financial Review, The Nine Network and Crikey. |