OIL PRICES SEESAW AFTER 6% SLUMP DUE TO ECONOMIC CONCERNS; BRENT REACHES $113.32/BBL
Business Today - Jun 20, 2022
Brent crude futures LCOc1 gained 20 cents, or 0.2%, to $113.32 a barrel by 0105 GMT, after rising as much as 1% earlier. Front-month prices tumbled 7.3% last week, its first weekly fall in five.
Oil prices wobbled early on Monday as investors refocused on tight supplies, though sentiment was still fragile after 6% slump in the previous session amid concerns about slowing global economic growth and fuel demand.
Brent crude futures LCOc1 gained 20 cents, or 0.2%, to $113.32 a barrel by 0105 GMT, after rising as much as 1% earlier. Front-month prices tumbled 7.3% last week, its first weekly fall in five.
US West Texas Intermediate crude CLc1 was at $109.55 a barrel, down 1 cent after rising more than $1 in early morning deals. Front-month prices dropped 9.2% last week, the first decline in eight weeks.
"For the moment, disruptions to oil supply are taking a back seat to concerns of weaker demand," ANZ analysts said in a note.
"The fundamental picture remains one of tightness amid the ongoing slowdown in Russian output."
Russian oil remains out of reach to most countries due to Western sanctions. The impact has been partly mitigated by the release of strategic petroleum reserves, led by the United States, and a ramp-up of production from OPEC+ although that is thinning the world's buffer against further supply disruption.
"If Washington sticks to its current pace, the US strategic reserve will hit a 40-year low of 358 million barrels by October," ANZ said.
Nevertheless, US oil and gas production is climbing.
The oil and gas rig count, an early indicator of future output, rose seven to 740 in the week to June 17, its highest since March 2020, energy services firm Baker Hughes Co BKR.N said in its closely followed report on Friday.
In Libya, oil production remained volatile following blockades by groups in the country's east.
