Pump jacks operate at sunset in an oil field in Midland, Texas US in this file photo.
Oil prices were little changed on Thursday but posted a third weekly gain as markets weighed further production cuts targeted by OPEC+ and falling US oil inventories against fears about the global economic outlook. Brent crude settled up 13 cents, or 0.2 percent at $85.12 a
barrel.
West Texas Intermediate US crude closed 9 cents, or 0.1 percent higher at $80.70. There was no trading on the Good Friday holiday. Both benchmarks jumped more than 6 percent this week after OPEC+ surprised the market on Sunday with a pledge of production cuts.
Hedge funds have bought crude all week, moving from the sidelines back into “risk on” mode, analysts said.
Prices drew support from a steeper-than-expected drop and a second consecutive weekly drawdown in US crude inventories last week. Gasoline and distillate inventories also declined, hinting at rising demand.
US energy firms last week also cut the number of oil rigs for a second week in a row. The rig count, an early indicator of future output, dropped two to 590 last week, Baker Hughes data showed. Limiting gains, however, the US labor market data pointed to slowing economic growth and there was also slower growth in the US services sector.
Asian Spot Prices Remain at 21-month Low Asian spot LNG prices remained flat last week at the lowest level since July 2021 on muted demand and solid inventories in China, Japan and Korea.
The average LNG price for May delivery into northeast Asia was $12.50 per million British thermal units (mmBtu), unchanged from the previous week, industry sources estimated. Prices have fallen 55 percent year-to-date and more than 82 percent from the August 2022 peak of $70.50/mmBtu. Europe is still a favourable destination for cargoes, despite a series of strikes in France that have reduced the country’s LNG imports by around one million tonnes in March, as cargoes have been diverted to neighbouring terminals.
Despite Europe’s colder start to the shoulder season - the months after winter and ahead of summer - prices have continued to trade sideways with most markets sitting on above-average gas inventories, analysts said.
In the US, natural gas futures slipped more than 6 percent to a one-week low on Thursday on rising output and forecast for milder weather and less heating demand. Front-month gas futures for May delivery on the New York Mercantile Exchange (NYMEX) fell 14.4 cents to settle at $2.01 per mmBtu. The contract has fallen more than 9 percent last week.
