Oil prices jump after EU leaders agree to ban most Russian crude imports
Oil prices surged on Tuesday after EU leaders reached an agreement to ban 90% of Russian crude by the end of the year. However, prices reversed course around 2 p.m. ET Tuesday following a report from The Wall Street Journal that OPEC is considering suspending Russia from the group’s output agreement. “It could certainly facilitate an early end to the current production agreement and a Saudi/UAE ramp up,” said Helima Croft, managing director and head of global commodity strategy at RBC. “However in most cases it is the actual stressed producer that asks for the exemption. An involuntary exemption might mean the breakup of OPEC+,” she added. Click Here to read more from CNBC.
US will see higher gas prices if oil production is not increased: Former energy secretary
Former Energy Secretary Dan Brouillette warned if the Biden administration doesn’t increase oil production in the U.S., Americans will see higher gas prices. Brouillette made the argument on “Cavuto: Coast to Coast” on Tuesday as the national average of one gallon of gas was $4.62, according to AAA. Last year it was priced at $3.04 — $1.58 less, as Americans continue to pay record gas prices at the pump. He suggested that the higher oil prices stem from the lack of energy production in the U.S., compared to other parts of the world. “[In] 2019, we produced…almost 13 million barrels a day of oil here in the United States. Today, we’re at about 11 and a half…there’s a one and a half million barrel per day deficit,” Brouillette said. “That scarcity is what’s creating much of the higher pricing that you’re seeing in the marketplace today.” Click Here to read more from Fox Business.
Rising Energy Prices Could Tip World Into 1980s-Style Recession
Rising energy prices and boxing Russian crude oil out of the global market risks a global recession, Bank of America’s head of global commodities and derivatives research Francisco Blanch warned in a recent research note. “Can the global economy continue to expand with tightening oil supplies? Our estimates suggest that the world can handle a total disruption of just about 2mn b/d of Russian oil without risking a global recession,” the note cautioned. In 2023, BoA sees oil demand approaching pre-Covid levels—but only if Russia’s crude oil and condensate production stays at 10 million bpd and OPEC+’s crude oil output increases. Click Here to read more from Oil Price.
Oil firms on EU’s Russian oil ban and end of Shanghai lockdown
Oil prices firmed on Wednesday after European Union leaders agreed to a partial and phased ban on Russian oil and as China ended its COVID-19 lockdown in Shanghai. Brent crude was up $1.30, or 1.1%, at $116.90 a barrel by 1149 GMT. U.S. West Texas Intermediate (WTI) crude rose $1.05, or 0.9%, to $115.72. Both benchmarks registered gains over May, marking the sixth straight month of rising prices. “The mood on the oil market is seemingly turning ever more bullish,” said Julius Baer analyst Norbert Rucker. “Europe’s embargo and China’s partial reopening is fueling supply fears and lifting oil prices.” Click Here to read more from Reuters.
This article is part of Mid-Week Review