Energy
Thursday, May 16th, 2024 4:27 pm EDT
Key Points
- U.S. crude oil stockpiles decreased by 2.5 million barrels last week, indicating increased refinery activity and potential rising demand.
- Energy prices rose: West Texas Intermediate (WTI) at $79.37 per barrel (up 0.9%), Brent at $83.30 per barrel (up 0.65%), RBOB gasoline at $2.54 per gallon (up 1.58%), and natural gas at $2.48 per thousand cubic feet (up 2.61%).
- Easing inflation in April led to higher expectations of a potential Federal Reserve interest rate cut in September, which could boost economic activity and crude oil demand.
Oil prices experienced an uptick on Thursday following a second consecutive week of declining U.S. crude stockpiles and signs of easing inflation. According to the Energy Information Administration, U.S. crude inventories fell by 2.5 million barrels last week, driven by increased refining activity, suggesting a possible rise in demand.
In the energy markets, West Texas Intermediate (WTI) for June delivery rose to $79.37 per barrel, marking an increase of 71 cents or 0.9%. This brings the year-to-date gain for U.S. crude oil to 10.76%. Brent crude for July delivery climbed to $83.30 per barrel, up 55 cents or 0.65%, achieving a year-to-date advancement of 8.3%. RBOB gasoline futures for June saw a more substantial increase of 1.58%, reaching $2.54 per gallon, and showing a significant 20.6% rise since the beginning of the year. Natural gas futures for June also edged higher, up 2.61% to $2.48 per thousand cubic feet, though they remain down by 1.3% year-to-date.
The easing of inflation in April contributed to a shift in market sentiment, with futures traders anticipating a higher likelihood that the Federal Reserve might lower interest rates in September. Lower interest rates generally stimulate economic activity, which can, in turn, boost demand for crude oil.
While WTI and Brent have seen modest gains over the week, they have faced losses of 3% and 5.2% respectively for the month. Despite these monthly setbacks, the year-to-date performance remains positive for both U.S. crude and Brent crude, indicating resilience in the oil market amidst fluctuating economic indicators and market conditions.
This recent increase in energy prices reflects a complex interplay of supply dynamics, economic policy expectations, and market sentiment. As refiners continue to process more crude, and with potential interest rate cuts on the horizon, the outlook for crude oil demand may remain robust in the coming months.
For the full original article on CNBC, please click here: https://www.cnbc.com/2024/05/16/crude-oil-prices-today.html
