- OPEC and key ally Russia moved a conference call to discuss future output cuts.
- Brent for August settlement increased by $1.25 to $39.57 a barrel.
- West Texas Intermediate for July rose by $1.37 to $36.81 a barrel on the New York Mercantile Exchange.
- The Brent benchmark traded at the premium of $2.76 to WTI. Gasoil for June delivery added $20.25.
- Oil prices have soared thanks to record supply cuts by OPEC+.
- U.S. sanctions choked exports and two Mexican firms that had acted as intermediaries for Venezuelan crude sales
MABUX World Bunker Index (consists of a range of prices for 380 HSFO, VLSFO, and MGO (Gasoil) in the main world hubs continued to increase on June 2, says a press release published on its website.
World oil indexes
- 380 HSFO – USD/MT – 265.74 (+6.18)
- VLSFO – USD/MT – 309.00 (+8.00)
- MGO – USD/MT – 380.27 (+6.03)
Meantime, world oil indexes also demonstrated upward changes on June, 02 as OPEC and key ally Russia moved a conference call to discuss future output cuts to Thursday, June 4, from an original June 9 schedule.
Brent for August settlement increased by $1.25 to $39.57 a barrel on the London-based ICE Futures Europe exchange. West Texas Intermediate for July rose by $1.37 to $36.81 a barrel on the New York Mercantile Exchange. The Brent benchmark traded at the premium of $2.76 to WTI. Gasoil for June delivery added $20.25.
Oil indexes continue to rise
Today morning oil indexes continue to rise amid optimism that major producers will extend production cuts as the world recovers from the coronavirus.
Oil prices have soared over the past six weeks, thanks to record supply cuts by OPEC+. However, prices are still down about 40% for the year so far.
These supply cuts are set to be scaled back at the end of June, according to the agreement hammered out in April, but OPEC+ producers are now said to be considering extending their production cuts into July or August, at an online meeting likely on June 4.
The U.S. sanctions
The U.S. Treasury Department on June, 2 had sanctioned four shipping firms for transporting Venezuelan oil, the latest escalation in Washington’s effort to oust socialist President Nicolas Maduro by cutting off the OPEC nation’s crude exports.
Marshall Islands-based Afranav Maritime Ltd, Adamant Maritime Ltd, and Sanibel Shiptrade Ltd, as well as Greece-based Seacomber Ltd, all own tankers that lifted Venezuelan oil between February and April of this year.
In response, Venezuelan Foreign Minister Jorge Arreaza said in a tweet that Pompeo had a “criminal obsession“ with Venezuela and that the U.S. moves to inhibit crude exports would complicate food and medicine imports.
Washington sanctioned Venezuelan state-run oil company Petroleos de Venezuela last January, shortly after the United States and dozens of other countries declared Maduro a usurper who rigged his 2018 re-election.
Tuesday’s sanctions come after Washington in February and March sanctioned two units of Russia’s Rosneft, which became the main intermediary of Venezuelan crude in 2019. The units stopped lifting Venezuelan crude in March.
Oil exports oil plummet
Meanwhile, Venezuela’s oil exports plummeted in May to their lowest level since 2003 as U.S. sanctions choked exports and two Mexican firms that had acted as intermediaries for Venezuelan crude sales stopped receiving oil. May exports fell 50% from the average of January through April.
PDVSA’s schedule for June shows little change from May, with only three crude cargoes assigned to buyers so far and three more waiting for nominations. The measures have reduced exports and deepened the country’s economic crisis.
Early signs of a shale rebound are becoming evident as crude prices emerge from their dramatic collapse earlier this year. EOG Resources Inc., America’s largest shale-focused producer, plans to “accelerate” output in the second half after shutting in about a quarter of its crude in May.
- Permian producer Parsley Energy Inc. is also turning wells back on just weeks after closing the taps, and producers in the Bakken formation in North Dakota are also easing the rate of shut-ins.
- The American Petroleum Institute (API) estimated June,02 a small crude oil inventory draw of 483,000 barrels for the last week. It was expected an inventory build of 3.038 million barrels.
- Oil production in the United States has now fallen from 13.1 million bpd on March 13 to 11.4 million bpd for May 22 —a drop of 1.7 million bpd—more than OPEC’s production cut agreement from last year.
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Source: MarineBunkerExchange
