Oil Futures Settle Mixed ahead of Data, Renewed Tensions
WASHINGTON, D.C. (DTN) -- Nearest delivered New York Mercantile Exchange oil
futures and Brent crude on the Intercontinental Exchange settled mixed in
choppy trade on Tuesday, with West Texas Intermediate reversing off the
three-weeks high, while renewed tensions in the Middle East limit losses.
NYMEX June WTI futures expired $0.11 lower at $62.99 bbl while the July
delivered contract finished the session at $63.13 bbl, a 14cts premium to
expiring contract. ICE July Brent futures settled up $0.21 at $72.18 bbl.
NYMEX June RBOB futures settled 0.94cts higher at $2.0193 gallon and the
June ULSD contract gained 0.58cts to settle at $2.0794 gallon.
Middle East tensions flared up again on Tuesday after Iran-aligned Houthi
rebels launched another attack against Saudi Arabia, hitting a military base
and an airport in the southern city of Najran. The attack came after Iran
announced it had quadruped its uranium-enrichment production capacity, while
Saudi Arabia called for an emergency summit on the regional security crisis.
Saudi Arabia had previously accused Iran of ordering last week's drone attack
on its oil pipeline and tankers off the coast of United Arab Emirates.
WTI and Brent futures climbed to three-week highs Monday on reports that the
Organization of Petroleum Exporting Countries would extend the current
production cut agreement beyond the June's expiration. Saudi Arabia's Energy
Minister said the group reached a consensus that production targets should
"roll over for the rest of the year", as global inventories remain above normal
level. However, reports emerged that several scenarios are currently being
considered by the group, including reduced production targets for individual
countries. In April, OPEC reached 168% compliance rate with the current
agreement, while holding the cumulative production near four-year low level.
The American Petroleum Institute is due to release supply data on U.S.
inventories at 4:30 PM ET while official figures from Energy Information
Administration are set to be published 10:30 AM ETE on Wednesday.
Market participants expect commercial crude stocks fell 2 million bbl in the
week ended May 17, after gaining 5.4 million bbl a week prior. In refined
products, analysts expect U.S. gasoline inventories built by 1 million bbl last
week, while distillate stockpiles fell 1 million bbl.
Liubov Georges, 1.646.359.4088, email@example.com, www.dtn.com. (c)
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