Connect with us


Oil futures prices are getting cheaper, but the rate of decline is gradually slowing down

letizo News



A separate cause for concern is the supply of Russian oil to world markets. Oil futures prices today continue to decline amid concerns about the recession and the news about the restoration of production in Libya.

On July 22, 2022, the price of Brent oil futures for October at the London Stock Exchange ICE Futures decreased by 1.11%, to $98.38/barrel. The price of October oil futures of the Brent brand on the London ICE Futures exchange decreased by 1.11% to $98.38/bbl.

Oil futures WTI for September at electronic trading on the New York Mercantile Exchange (NYMEX) fell by 1.71%, to $94.70/bbl. The price went down by 1.71% to $94.70 per barrel. Brent crude oil went down in price by 2.15% and WTI crude oil – by 2.75%.

Crude Oil Futures: Oil Continues to Decline on July 25, 2022

But the rate of decline is gradually slowing. The price of October oil futures for Brent on ICE Futures fell by 0.92%, to $97.47/bbl. The price of October oil futures of Brent on ICE Futures decreased by 0.92% to $97.47 per barrel. On electronic trading, NYMEX crude oil futures WTI for September fell by 0.89% to $93.86/barrel. US dollars per barrel.

U.S. natural gas futures are near $8.2/bbl. USD/mln Btu (USD 294/1000 m3). On July 22, 2022, natural gas futures for September on the NYMEX rose 4.86% to $8.195/million Btu. USD/mln Btu.

On July 25, 2022, quotes rose 0.65% to $8.248/million Btu. On July 25, 2022, quotes rose 0.65% to $8.248/million Btu. Gas quotations in Europe are holding above $1,700/mln Btu. USD/1000m3. August gas futures on ICE Futures’ TTF hub in the Netherlands were trading at 164.9 Euro/MWh (USD 1763.8/1000m3) by 11:30 Moscow time on July 25, which was 3.15% higher than the previous day’s settlement price.

Oil futures prices start new week with decline 

Oil futures prices start the new week lower on another wave of recession fears and reduced supply worries. The U.S. Federal Reserve (Fed) will meet on July 26-27, 2022 and expect another 75 bps hike in the benchmark interest rate.

A serious tightening of the Fed’s monetary policy, according to many experts, could lead to a recession in the U.S. economy.

The head of the U.S. Treasury D. Yellen, in an interview to TV channel NBC on July 24, admitted that the U.S. economy is slowing down, while denying the recession.

Д. Yellen said that the economy is slowing down against a background of strong recovery growth in the post-pandemic period – in 2021, the U.S. economy grew by 5.5%. According to the minister, the economy is not in a period of recession, but in a period of change; when growth slows down, it is necessary, and appropriate to the situation.

According to the U.S. Department of Commerce, the U.S. economy in the 1st quarter of 2022 decreased by 1.6% in annual terms, and expert estimates indicate that the decline continued into the 2nd quarter of 2022. Thus, the decline lasted for the 2nd consecutive quarter, which is considered the definition of a technical recession.

The market paid attention to data from Libya

National Oil Corporation (NOC) on July 23, 2022 reported that after the lifting of the force majeure on the fields and export ports, daily production increased from 560 kbpd as of July 11 to 860 kbpd as of July 22. Within 2 weeks, NOC plans to increase its oil production to 1.2mbpd.

The growth of active rigs in the USA continues to slow down

According to Baker Hughes, the number of active oil and gas rigs in the US rose by 2 units to 758 in the week ended July 22, 2022. The number of active oil rigs remained unchanged at 599.

The number of gas rigs increased by 2 units to 155. The number of multifunctional rigs remained unchanged at 4.

Separate cause for market concern are Russian oil supplies to the world market

On July 21, 2022, the EU adjusted the sanctions regime against Russia, allowing Russian state companies to supply oil to third countries to limit the risks to global energy security.

However, the market sees risks to Russia’s oil supply due to the US and G7 plans to set ceiling prices for Russian oil by December 2022.

Russia may stop supplying oil to countries that will introduce a price ceiling for Russian oil, which will provoke a rise in global prices.


Brent crude oil futures its lowest since 2021 amid banking crisis

letizo News



Brent crude oil futures

The cost of May futures on Brent crude oil fell to $72.74 per barrel, losing 0.31%, according to data from the ICE exchange. Brent was trading at about $70 a barrel at its low for the day. That’s a record low for at least 15 months, that is, since December 2021.

WTI prices are also falling, with futures prices down to $66.43 a barrel (-0.46% from last week’s close), according to the exchange. WTI was trading at $64.12 a barrel at its low for the day. This is also the lowest value since at least December 2021.

The market is thus responding to the banking crisis: since the beginning of March, three banks (Silvergate Bank, Silicon Valley Bank, Signature Bank) have closed their doors in the US, and the day before, on March 19, Swiss UBS took over its rival, Credit Suisse, buying the bank for $3.2bn amid fears of its collapse. Investors fear a recession, which may cause a crisis in the banking sector, as a recession, in turn, would lead to lower demand for fuel, the agency said.

“Oil prices are moving mainly because of fears [of further oil price dynamics]. Supply and demand fundamentals are almost unchanged, only the banking problems have an impact,” said Price Futures Group analyst Phil Flynn.

Oil prices lifted from daily lows helped the S&P 500 and Dow Jones indices, which rose Monday, writes Reuters. Traders raised their expectations that the U.S. Federal Reserve would refuse to raise rates this Wednesday to protect financial stability amid banking problems, the agency noted.

“Volatility is likely to persist this week, with broader financial market concerns likely to remain at the forefront,” ING Bank analysts said in a note. They add that the impending Fed decision adds to uncertainty in markets.

Earlier we reported that the price of Brent dropped below $75 per barrel for the first time in more than a year.

Continue Reading


Gold prices will reach $2,075 “in the coming weeks”

letizo News



Gold prices will reach

Gold prices may continue to rise, analysts polled by the CNBC TV channel said. In their opinion, the difficulties of banks and a possible turning point in the policy of the Federal Reserve indicate the possibility of a new rise in gold prices.

“I think it’s likely that we’ll see a strong move in gold in the coming months. The stars seem to be aligned for gold, and it could soon break new highs,” said Craig Erlam, senior market analyst at brokerage Oanda.

The expert explained that interest rates are now at or close to their peak, and the market, amid recent developments in the banking sector, is laying on an earlier than previously expected start of rate cuts. They also added that this situation would boost demand for gold even if the U.S. dollar weakens.

This month, Fitch Solutions rating agency predicted that gold prices would reach $2,075 an ounce “in the coming weeks” amid global financial instability, writes RBC. The company also added that gold prices will remain at a higher than pre-pandemic levels in the coming years. Craig Erlam confirmed this forecast.

Other Wall Street experts are also predicting a long-term rise in gold prices. For instance, Tina Teng, analyst for British financial company CMC Markets, thinks that the U.S. Federal Reserve’s sooner departure from its policy of raising interest rates might provoke another rally in gold prices due to the weakening U.S. dollar and falling bond yields.

Earlier we reported that oil prices accelerated their decline, continuing a trend from the beginning of the week.

Continue Reading


Analysts at U.S. bank Goldman Sachs revised its forecast on oil prices

letizo News



oil price forecast

Analysts at U.S. bank Goldman Sachs, one of the most optimistic forecasts about the cost of oil, changed its earlier forecast about the growth of oil prices to $100 in the next 12 months, Bloomberg said.

Now analysts predict that Brent crude oil will reach $94 per barrel in the next 12 months and $97 per barrel in the second half of 2024, the publication said.

The bank said oil prices have fallen despite rising demand in China, given pressure on the banking sector, recession fears and investor withdrawal.

“Historically, after such traumatic events, price adjustments and recoveries are only gradual,” the bank notes.

This week, the situation surrounding Swiss bank Credit Suisse triggered panic in the markets as oil plummeted to a 15-month low and Brent crude fell 12% to below $73 a barrel.

After the price decline, the bank expects OPEC producers to increase production only in the third quarter of 2024, contrary to Goldman’s forecast that it will happen in the second half of 2023. Analysts at the bank believe a barrel of Brent blend will reach $94 in the next 12 months and trade at $97 in the second half of 2024.

Bloomberg reported that the largest oil exporter, Saudi Arabia, announced higher April oil prices for markets in Asia and Europe.

Earlier, we reported that Iraq and OPEC advocated for guarantees of no fluctuations in oil prices.

Continue Reading


©2021-2023 Letizo All Rights Reserved