Will crude oil prices pick up where they left off on Friday and continue surging higher? That’s the question on Monday after crude prices finished higher last week as benchmark prices finished up by 25%.
West Texas Intermediate was up 5% or $1.19 and finished at $24.74 a barrel, just under the $25 mark. Analysts attributed the increase to optimism over production cuts and rising demand for gasoline. Gasoline prices last week were up several cents a gallon as the U.S. reopened following the coronavirus pandemic.
The international benchmark, Brent Crude rose 5% or $1.42 and settled Friday at $30.88 a barrel. Natural gas lost 7 cents and finished trading on the New York Mercantile Exchange at $1.82 per MMBtu.
Local stocks generally saw an increase in prices with Devon Energy up 6% or 69 cents a share ending the day at $12.70. ONEOK rose 5% or $1.58 and finished at $31.33 a share.
Chesapeake Energy added 10 cents to settle at $14.70 while ConocoPhillips rose $1.08 to reach $43.08.
Marathon Oil added 27 cents and ended the day up 5% at $5.78. Phillips 66 grew 38 cents to hit $77.06, a 5% increase.
SandRidge Energy saw its shares jump 21 cents to reach $1.88 for a 13% increase. Mammoth Energy dropped a nickle to $1.10, a 4% decline in value. NGL Energy dropped 12 cents to $5.40.
American Electric Power grew $1.26 to hit $79.86 for a 2% gain.
“While rising crude and product stocks continue to pose a threat to market fundamentals, key trends on both the supply and demand side have shifted bullish in recent data,” said Robbie Fraser, senior commodity analyst at Schneider Electric.
West Texas Intermediate crude for June delivery CL.1, -0.44% CLM20, -0.44% on the New York Mercantile Exchange, rose $1.19, or 5.1%, to settle at $24.74 a barrel. Prices for the front-month contract rose 25.1% for the week, according to Dow Jones Market Data.
Global benchmark July Brent crude BRNN20, -0.35% added $1.51, or 5.1%, at $30.97 a barrel on ICE Futures Europe, for a 17.1% weekly climb.
“On the supply side, Saudi Arabia has increased its export price” as output cuts of nearly 10 million barrels per day by the Organization of the Petroleum Exporting Countries and their allies, collectively known as OPEC+, are officially under way, Fraser said in a daily market note.
“Meanwhile, the world’s leading crude producer over the past year—the United States—saw production fall another 200,000 barrels per day,” he said, citing data from the Energy Information Administration released Wednesday for the week ended May 1.
In its assessment on oil issued Friday, IHS Markit said the second quarter of this year will “see the largest volume of liquids production cuts, including shut-in production, in the history of the oil industry.” It expects as much as 17 million barrels per day total liquids output, including nearly 14 million barrels per day of crude-oil production, to be cut or shut-in during the period between April and June.