Fears of being demand plummeted, the situation of global oil supply surplus likely to continue, coupled with global trade blockade may inhibit epidemic situation after unlocking the economic recovery, oil pan (May 4) fell on Monday, giving up last week’s gains: 11 PM est 45 points 23 point 45 (Beijing time), WTI crude oil futures prices rose in June 5 cents, or 0.25%, to $19.83 a barrel. WTI crude rose nearly 15% last week; Brent crude futures fell 19 cents, or 0.72 percent, to $26.25 a barrel. Oil was up about 5.6% last week.
Michael McCarthy, chief market strategist at CMC Markets, said: “optimism about the outlook for global growth has faded and oil is giving back last week’s gains as the dollar strengthens.”
The market found support last week after major producers, led by Russia, began cutting production on May 1. Separately, exxon mobil and chevron, the top two us oil companies, said they would each cut output by 400,000 barrels a day this quarter. The cutbacks, combined with the unplugging of the economy in some us states and cities around the world, are expected to ease the global fuel glut and the storage of oil tankers that drove oil prices higher last week.
Goldman expects demand to continue to accelerate in the coming weeks as the blockade eases. Goldman sachs revised up its ICE brent forecast for the second quarter of 2020 to $25 a barrel from $20 and slightly revised up its full-year forecast to $35.8 from $35.2. However, Goldman notes that the physical oil market is still in a state of surplus, and while we expect a bull market after this pressure relief rally, it will take time and patience.
On Friday, oil services company Baker Hughes reported that total U.S. oil RIGS fell for the seventh straight week in the week ended May 1, with the number of active U.S. Wells dropping 53 to 325. The total number of Wells drilled fell 57 to 408; The number of active natural gas Wells drilled during the week fell four to 81. In April, us oil drillers cut a total of 246 RIGS, the biggest monthly drop since January 2015, and the lowest number since June 2016.