Crude oil prices fell on Tuesday as global supply risks eased. August WTI crude closed down 1.25 dollars, or 1.77 percent, and August RBOB gasoline closed down 0.0063 dollars, or 0.22 percent. Morgan Stanley reported that 35 oil and gas tankers exited the Persian Gulf through the Strait of Hormuz last Thursday, the first time traffic returned to the typical pre-war range of 30 to 40 tankers. Bloomberg calculations show Persian Gulf crude exports have recovered to at least 75 percent of pre-war levels. Russian crude exports also rose, with the four-week average reaching 4.13 million barrels per day through June 28, the highest since Russia invaded Ukraine in 2022. Iraq warned last Thursday it might quit OPEC if it does not receive a higher output quota. The International Energy Agency on June 17 forecast world oil consumption will decline by 1.1 million barrels per day this year, a larger drop than its previous estimate of 420,000 barrels per day. The Department of Energy raised its US 2026 crude production estimate to 13.72 million barrels per day from a May estimate of 13.65 million barrels per day. Ukrainian drone attacks on Russian oil infrastructure continue, with Russian crude-processing rates averaging 4.32 million barrels per day in the first 10 days of June, the lowest in 20 years. OPEC delegates said on May 14 the cartel aims to continue a series of oil quota increases over the next few months, completing the return of halted production by the end of September. Vortexa reported that crude oil stored on tankers stationary for at least seven days fell 9.4 percent week-over-week to 82.24 million barrels in the week ended June 26. The consensus estimate for Wednesday's weekly EIA report is a decline of 2.25 million barrels in crude inventories and a decline of 861,000 barrels in gasoline supplies. Last Wednesday's EIA report showed US crude oil inventories as of June 19 were 6.5 percent below the seasonal five-year average, gasoline inventories were 5.6 percent below, and distillate inventories were 10.3 percent below. US crude oil production in the week ending June 19 rose 0.1 percent week-over-week to 13.819 million barrels per day. Baker Hughes reported the number of active US oil rigs rose by seven to a one-year high of 440 rigs in the week ended June 26.
Baker Hughes CoFalling crude prices and easing supply risks reduce demand for oilfield services from Baker Hughes.
Morgan Stanley