Your Daily Energy Report for June 7, 2024
Posted on 2024-06-07
Crude Oil
Crude Oil futures for July settled down -$.02 or -.026% at $75.53. Oil prices experienced a minor decline today, on track for a third consecutive weekly loss after strong U.S. jobs data on Friday tempered expectations for an imminent interest rate cut by the Federal Reserve. The data revealed that job growth in the U.S. accelerated significantly more than anticipated in May, suggesting the Fed is likely to delay any rate cuts until at least September. Higher borrowing costs can hinder economic activity and reduce oil demand. However, support for oil prices came from OPEC+ members Saudi Arabia and Russia, who indicated they might pause or reverse increases in oil production. Additionally, there were concerns about demand from China, the world's largest importer of crude oil, where data showed that while exports increased for a second month in May, crude oil imports declined. The Biden Administration said on Friday it has sped up offers to replenish crude oil for the Strategic Petroleum Reserve.
Natural Gas
Natural Gas futures for July settled up $.097 or 3.438% at $2.918. Natural gas futures climbed on Friday, reflecting a weekly gain exceeding 12%. This surge was attributed to forecasts predicting increased cooling demand due to warm weather expected in June. The anticipation of above-average temperatures, especially in the Midwest and East, bolstered market confidence, with projections indicating this heatwave may continue in the coming weeks. Meanwhile, Baker Hughes reported a reduction in oil rigs by four, bringing the total to 492, the lowest since January 2022, and a decrease in gas rigs by two, totaling 98, the lowest since October 2021. Additionally, on Friday, energy company Williams requested federal energy regulator approval to commence more operations of the ongoing Regional Energy Access natural gas project by July 1.