Your Daily Energy Report for June 21, 2024
Posted on 2024-06-21
Crude Oil
Crude Oil futures for August settled down -$.56 or -.689% at $80.73. Crude prices fell on Friday due to concerns that global oil demand growth might be impacted by a strong U.S. dollar and negative economic news from certain regions. The U.S. dollar reached a seven-week high against a basket of other currencies, driven by the Federal Reserve's cautious approach to reducing interest rates, in contrast to more dovish policies elsewhere. A stronger U.S. dollar tends to reduce oil demand by making dollar-denominated commodities like oil more expensive for foreign currency holders. U.S. gasoline futures rose for the fourth consecutive day to a one-month high, fueled by increasing demand during the summer driving season and declining inventories. Geopolitical tensions also contributed to the situation as Ukraine's military reported drone strikes on four oil refineries, and other military targets in Russia.
Natural Gas
Natural Gas futures for August settled down -$.018 or -.631% at $2.836. Natural gas futures declined for the fifth time in six recent sessions on Thursday. Despite widespread heat affecting most of the contiguous United States, the market was more concerned with robust supplies and tropical disturbances in the Gulf of Mexico. Tropical storms and hurricanes typically exert downward pressure on natural gas prices due to reduced demand from cooling rains and potential disruptions to LNG plant operations. The heat had already been factored into market forecasts, prompting traders to focus on developing tropical storms and the return of production levels. Natural gas-powered electricity generation has increased year-over-year, driven by higher electricity demand and greater usage by data centers.