Oil Prices Continue to Grind Higher
(The views and opinions expressed in this article are those of the attributed sources and do not necessarily reflect the position of Rigzone or the author)
In this week’s preview of what to watch in oil and gas markets, Rigzone’s regular energy prognosticators take a look at oil prices, signs of potential demand destruction, the ongoing conflict in Ukraine and more. Read on below to find out the specifics.
Rigzone: What developments/trends will you be on the lookout for this week?
Jon Donnel, Managing Director, B. Riley Advisory Services: We will be looking for overt signs of demand destruction as commodity prices continue to grind higher. Retail fuel prices are hitting fresh record highs every day, but the product supplied details from the EIA’s weekly update have not shown much, or any, decrease in demand and TSA checkpoint numbers indicate an increase in passengers of about 20-25 percent compared to this time last year as we have fully entered the summer travel season. Refinery utilization remains at high levels as refiners do their best to take advantage of massive crack spreads, but throughput has not been sufficient to alleviate product supply shortages with both gasoline and ultra-low sulfur diesel stocks in the U.S. falling again last week. Here’s to hoping for an uneventful hurricane season.
John Stilwell, Principal, Grant Thornton LLP: Uncertainty over Ukraine will continue to be the driving force in oil markets in coming months. Despite Western calls for an accelerated increase in oil production to neutralize prices, OPEC+ is looking to maintain last year’s June 2nd agreement. The latest EU embargo will worsen the oil supply backdrop and will keep markets volatile over the second half of the year.
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