Energy
Thursday, August 29th, 2024 2:03 pm EDT
Key Points
- U.S. Crude Oil Prices Rise: U.S. crude oil futures increased to nearly $75 per barrel on Thursday, rebounding from a two-day decline as traders weighed supply disruptions in Libya against slowing demand in China.
- Libyan Supply Disruptions: Oil prices spiked earlier in the week due to threats from Libya’s eastern government to halt oil production and exports amid a political dispute. However, prices later moderated as the market assessed the potential impact on global supplies.
- Slowing Demand and Market Outlook: The oil market faces downward pressure from reduced demand, influenced by increasing electric vehicle sales and sluggish economic growth in China, contributing to a more bearish outlook for crude oil futures.
U.S. crude oil futures rose on Thursday to nearly $75 per barrel, rebounding after a two-day decline as traders balanced supply disruptions in Libya with slowing demand in China. The October contract for West Texas Intermediate (WTI) crude oil was priced at $74.92 per barrel, marking a 40-cent increase, or 0.54%. Year-to-date, U.S. crude oil prices have risen by 4.6%. Meanwhile, the Brent October contract traded at $78.87 per barrel, up 26 cents, or 0.34%, with a year-to-date gain of 2.5%. In gasoline markets, the September contract for RBOB gasoline remained relatively stable at $2.22 per gallon, a 5.7% increase for the year. Conversely, natural gas prices fell to $2.07 per thousand cubic feet, down 2 cents, or 1.14%, with a significant year-to-date drop of 17.5%.
Jeff Kilburg, founder of KKM Financial, observed that the October contract for crude oil has been constrained within a range between $71 and $80 per barrel throughout August. He noted that while supply disruptions should theoretically push crude oil prices higher, the impact of reduced demand from China is dampening market enthusiasm.
In Libya, political turmoil has intensified as the eastern government in Benghazi, which lacks international recognition, threatened to halt all oil production and exports. This action comes in response to the western government in Tripoli’s efforts to replace the head of the country’s central bank. The market saw a price spike on Monday due to these disruption threats, but prices have since moderated as traders assess the potential impact on global crude supplies.
Additionally, the broader oil market faces challenges from weaker demand forecasts, partly due to increased electric vehicle sales and sluggish economic growth in China, both of which are contributing to a bearish outlook for crude oil futures.
For the full original article on CNBC, please click here: https://www.cnbc.com/2024/08/29/crude-oil-prices-today.html
