Energy
Monday, September 9th, 2024 7:21 pm EDT
Key Points
- Crude Oil Price Rebound: U.S. crude oil futures rebounded by more than 1% on Monday after experiencing their worst week since October 2023, with West Texas Intermediate (WTI) and Brent benchmarks having fallen over 15% in the third quarter.
- Demand Loss: Goldman Sachs reported a significant loss of 400 million barrels in financial demand since early July, translating to a daily reduction of 7 million barrels, contributing to the recent price decline.
- Market Forecast and Production: OPEC+ has postponed its planned production increase set for October due to falling prices. Goldman Sachs anticipates that production will start increasing in December and projects Brent prices to range between $70 and $85 per barrel. Despite market challenges, Goldman Sachs estimates a 20% probability of a U.S. recession in the next 12 months.
On Monday, U.S. crude oil futures saw a rebound of over 1% following a challenging week, marking their worst performance since October 2023. Both the U.S. benchmark, West Texas Intermediate (WTI), and the global Brent benchmark experienced declines exceeding 15% in the third quarter. Daan Struyven, head of oil research at Goldman Sachs, highlighted a significant reduction in financial demand, noting a loss of 400 million barrels, equivalent to a daily reduction of 7 million barrels. This reduction has contributed to the recent drop in oil prices.
As of Monday’s close, WTI for October delivery was priced at $68.71 per barrel, up $1.04 or 1.54%, though it has fallen 4% year-to-date. Brent for November delivery settled at $71.84 per barrel, increasing by 78 cents or 1.1%, with a year-to-date decline of 6.8%. RBOB Gasoline for October delivery was up more than 2 cents to $1.92 per gallon, a decrease of 8.7% year-to-date. Natural Gas for October saw a decline of over 10 cents to $2.17 per thousand cubic feet, with a year-to-date loss of 13.7%.
The crude oil market has been pressured by weak demand in China and anticipated softening in consumption in Europe and the U.S., particularly as the summer driving season concludes and refineries enter maintenance periods. In response to falling prices, OPEC+ has postponed a planned production increase that was set to start in October. Goldman Sachs predicts that the group will begin boosting production in December and forecasts Brent prices to range between $70 and $85 per barrel. Despite the current market challenges, Goldman Sachs does not anticipate a recession, estimating a 20% probability of a U.S. economic recession over the next 12 months.
For the full original article on CNBC, please click here: https://www.cnbc.com/2024/09/09/crude-oil-prices-today.html
