Learn more about Hart Energy Conferences
Get our latest conference schedules, updates and insights straight to your inbox.
Oil rose on May 18 to hit $70/bbl for the first time since March, as expectations of demand recovery following reopenings of the European and U.S. economies offset concern over spreading coronavirus cases in Asia.
The British economy reopened on May 17, and Europe is starting to reopen cities and beaches. New cases in the U.S. continued to fall and New York lifted the mask requirement for vaccinated people.
Brent crude was up 47 cents, or 0.7%, at $69.93 by 0825 GMT, and earlier topped $70 for the first time since March 15. WTI crude in the U.S. was up 45 cents, or 0.7%, at $66.72.
“Economies are again switching a gear higher,” said Tamas Varga of broker PVM. “The euphoria is reflected in the general belief that the economic revival will be soon coupled with oil demand recovery.”
The latest gain to $70 brings Brent’s rally this year to 35%, supported by supply cuts by OPEC and allies. This could lead to a further advance, some analysts said.
“A rise through $70 should trigger more systematic buying and see it advance to $71.50 a barrel quite quickly,” said Jeffrey Halley, analyst at brokerage OANDA.
European and U.S. progress in the battle against the pandemic contrasts with the situation in Asia, which is limiting oil's rally.
Singapore and Taiwan have reinstated lockdown measures, and India has seen a plunge in fuel demand following restrictions to curb infections.
Also limiting oil’s upside is the prospect of a revival of Iran’s nuclear deal that would allow the OPEC producer to fully restart exports.
In focus later will be this week’s U.S. supply reports, expected to show a 1.7 million-barrel rise in crude inventories. The first report, from API, is out at 2030 GMT.
Recommended Reading
Analyst: Chevron Duvernay Shale Assets May Sell in $900MM Range
2024-01-29 - E&Ps are turning north toward Canadian shale plays as Lower 48 M&A opportunities shrink, and Chevron aims to monetize its footprint in Alberta’s Duvernay play.
CEO Darren Woods: What’s Driving Permian M&A for Exxon, Other E&Ps
2024-03-18 - Since acquiring XTO for $36 billion in 2010, Exxon Mobil has gotten better at drilling unconventional shale plays. But it needed Pioneer’s high-quality acreage to keep running in the Permian Basin, CEO Darren Woods said at CERAWeek by S&P Global.
Analysts: Why Are Investors Snapping Up Gulfport Energy Stock?
2024-02-29 - Shares for Oklahoma City-based Gulfport Energy massively outperformed market peers over the past year—and analysts think the natural gas-weighted name has even more upside.
Production from Canada’s Montney, Duvernay Gains Momentum
2024-01-05 - The dust has settled on acquisitions, and the leading players have publicized five-year plans that demonstrate a commitment to increasing production from Canada’s premier shale plays.
SilverBow Saga: Investor Urges E&P to Take Kimmeridge Deal
2024-03-21 - Kimmeridge’s proposal to combine Eagle Ford players Kimmeridge Texas Gas (KTG) and SilverBow Resources is gaining support from another large investor.