West Texas Intermediate for August delivery was at $52.88 a barrel in electronic trading on the New York Mercantile Exchange, up 10 cents, at 11:32 a.m. Sydney time. Sieminski said, “Low gasoline prices and higher employment will contribute to more driving this year, boosting USA gasoline consumption an estimated 170,000 barrels per day higher than in 2014″.
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“Commodity prices fell sharply this week with crude prices suffering their largest sell-off in five months, slumping more than 8.0 percent”. It had been sitting near US$60 a barrel for a few months after bottoming at US$43 in March.
The consensus of rising demand is positive for the crude oil market.
Karl Petrick, Economics professor at Western New England University, told 22News with current oil supplies already exceeding the demand, adding Iran into the mix may push prices even lower. “We could have a lot more volatility on Friday, if this keeps hanging over our heads”, said Tariq Zahir, an oil bear at Tyche Capital Advisors in Laurel Hollow in New York. Iran has 158 billion barrels of oil reserves, but that oil has been largely blocked from the global markets due to sanctions against Iran. Hall. Any nuclear deal with Iran won’t quickly revive the OPEC member’s crude exports, so wouldn’t immediately weigh on prices, Societe Generale said. A running of the bulls in the Chinese stock market pushed oil prices into positive territory in May, though the recent crash weighed heavily on the minds of investors anxious about the health of one of the world’s largest economies.
Demand for oil was also supported by the return from maintenance of a 120,000-barrels per day crude distillation unit in Japan, where machinery orders hit a 7-year high in May.
Oil’s rebound is paring a second weekly loss that’s driven by China’s equities rout and the turmoil in Greece.
The EIA (U.S. Energy Information Administration) released its July 2015 STEO (Short-Term Energy Outlook) report on Tuesday, July 7, 2015.
In Vienna, negotiators for a nuclear accord between Iran and world powers gave themselves more time as the talks stretched into a ninth day beyond their June 30 deadline. Pugh reduced his forecast for oil prices at the end of this year by $5 to $50 a barrel.
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“Crude oil prices plunged yesterday as Greek uncertainty and worries over a slowdown of the Chinese economy weighed on market sentiment”, noted Sucden analyst Myrto Sokou.
