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Oil futures traded on either side of unchanged Friday, but remained on track for a second, consecutive weekly decline as several countries joined the U.S. in releasing crude reserves.
Price action
-
West Texas Intermediate crude for May delivery
CL.1,
+0.30% CLK22,
+0.30%
rose 22 cents, or 0.1%, to $96.25 a barrel on the New York Mercantile Exchange, putting it on track for a weekly fall of 3%. -
June Brent crude
BRN00,
-0.05% BRNM22,
-0.05% ,
the global benchmark, fell 9 cents, or 0.1%, to $100.49 a barrel on ICE Futures Europe, and was headed for a weekly drop of 3.8%. -
May natural-gas futures
NG00,
+2.03% NGK22,
+2.03%
were up 1.9% at $6.48 per million British thermal units, after ending Thursday at a 13-year high. -
May gasoline
RBK22,
-0.25%
was down 0.4% at $3.028 a gallon, while May heating oil
HOK22,
+0.76%
was up 0.9% at $3.297 a gallon.
Market drivers
Crude has seen volatile trade since Russia’s late-February invasion of Ukraine, with the U.S. benchmark briefly trading at a roughly 14-year high above $130 a barrel in early March, while Brent came within a whisker of $140. WTI had closed at $92.10 a barrel on the eve of the invasion on Feb. 23, while Brent had traded at $94.05.
The Biden administration last week announced it would release 180 million barrels of crude — at a pace of 1 million barrels a day for six months — from the U.S. Strategic Petroleum Reserve. The International Energy Agency this week said its member nations would join in, releasing another 60 million barrels that would be matched by the U.S. as part of its 180 million barrel release.
The “massive” release of oil from emergency reserves was expected to noticeably ease the supply situation, said Carsten Fritsch, analyst at Commerzbank.
Meanwhile, the lockdown of Shanghai by Chinese authorities in response to COVID-19 cases has been extended, adding to price weakness, Fritsch wrote.
“This means that the business metropolis with its 25 million inhabitants, which accounts for around 4% of Chinese oil demand, is condemned to remain at a standstill,” he said.
Meanwhile, natural-gas production “remains in a disappointing range based on the daily data we look at, coal prices are high and stocks are low, tightening the coal-to-gas displacement band,” said Christopher Louney, analyst at RBC Capital Markets, in a note. “Nuclear outages are high and cold weather has gyrated in certain regions, all while the global gas picture remains tense and Russia’s war in Ukraine continues.”
Read: U.S. natural gas prices just hit a 13-year high. Blame coal, say analysts
