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Petroleum industry

Crude Futures Soar Amid Higher Demand Forecasts and Strengthening Euro

Strategic Insights

— 2 min read

Crude futures rebounded on Tuesday, driven by higher demand forecasts and a stronger euro. The Energy Information Administration (EIA) revised its global demand forecasts for the remainder of 2015 upward by 190,000 barrels per day to 93.28 million bpd. Energy traders locked into some of their gains in U.S. afternoon trading, after Texas Light Sweet futures moved above $61 for the first time since May 7. The EIA also anticipates that WTI crude prices will average $54.32 a barrel for the remainder of the year, up from prior estimates of $52.52.

Key Takeaways:

  • WTI crude futures for June delivery rose 1.48 or 2.50% to 60.73 a barrel, closing above $60 for the first time in five sessions.
  • The EIA revised its global demand forecasts for the remainder of 2015 upward by 190,000 barrels per day to 93.28 million bpd.
  • WTI crude prices are expected to average $54.32 a barrel for the remainder of the year, up from prior estimates of $52.52.
  • OPEC increased its forecast for crude demand for the rest of 2015 to 92.5 million bpd, up 50,000 barrels from prior estimates.
  • The spread between the international and U.S. domestic benchmarks of crude stood at $6.13, above Monday's level of $5.69.
  • The EIA expects brent crude to average 60.79 for the remainder of the year, widening the spread with WTI to $6.47 a barrel.
  • A high level of uncertainty in global oil markets could cause crude prices to "deviate from current projections," the EIA said in the report.
  • Traders await the release of the American Petroleum Institute's weekly inventory report on Tuesday evening, which analysts have forecast a 125,000 decline in stockpiles for the week that ended May 8.

Statistics:

  • WTI crude futures rose 1.48 or 2.50% to 60.73 a barrel.
  • The EIA revised its global demand forecasts for the remainder of 2015 upward by 190,000 barrels per day to 93.28 million bpd.
  • WTI crude prices are expected to average $54.32 a barrel for the remainder of the year.
  • The spread between the international and U.S. domestic benchmarks of crude stood at $6.13, above Monday's level of $5.69.
  • The EIA expects brent crude to average 60.79 for the remainder of the year.
  • OPEC increased its forecast for crude demand for the rest of 2015 to 92.5 million bpd, up 50,000 barrels from prior estimates.

Sources:

  • Bharat Petroleum Corporation Limited news release
  • Energy Information Administration (EIA) short-term energy outlook
  • New York Mercantile Exchange (NYMEX)
  • Intercontinental Exchange (ICE)
  • Wall Street Journal
  • OPEC
  • American Petroleum Institute
  • Editorial, plusmediasolutions.com

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