April 1, 2022, 8:33 am by Josef Weichslberger
Oil prices on international commodity futures markets fell again yesterday and started this morning further discounted in Asian-dominated trading. As a result, heating oil prices in Germany can fortunately continue the downward trend that has been in place for weeks.
Currently, June contracts for European North Sea “Brent” oil are at US$103.60 per barrel, a barrel of US “West Texas Intermediate” oil costs US$99 per hour. The Euro has fallen sharply again against the Dollar and is now trading around $1.1070 this morning.
The US government’s plan to release 180 million barrels of strategic oil reserves was not without its impact on the oil market. Following last night’s confirmation, crude oil prices fell again.
Quite understandable, even if the action probably has an effect in the short or medium term. But one million barrels per day is undoubtedly an amount that can provide relief and today the International Energy Agency (IEA) is also meeting, which could decide on a similar measure.
However, yesterday there was no new decision or change of course in the OPEC+ organization. As expected, the financing alliance wants to maintain its current production policy and produce an additional 400,000 barrels a day from the beginning of May. There is concern about the ever-decreasing reserve capacities in many member states, which are also the reason why quotas have often not been met in recent months.
The coronavirus situation in China continues to put pressure on oil prices, where around 26 million people in Shanghai have been placed under a harsh lockdown. The economic consequences will also be felt in other countries and will put pressure on oil consumption. The first disappointing economic data came out of the Middle Kingdom yesterday. Manufacturing and services Purchasing Managers’ Indices fell below 50 for the first time in a long time, generally indicating a contraction in economic activity.
In the foreign exchange market, the euro suffered losses again against the US dollar yesterday. Uncertainty about the future modalities of Russian gas deliveries to Europe weighed on the common currency. Today there are a whole host of important economic indicators that could spark further price movements.
Meanwhile, the price of heating oil in Germany has fallen by around 35 percent on average since March 9 and has thus offset much of the increase caused by the war. In the meantime, however, the deductions are getting smaller. Current calculations mean that largely stable prices can be expected for today, initial price trends point to a slight additional downside. Consumers are now stocking up again at this significantly reduced level.
More market reports
Thursday, 03/31/2022, 08:38
Oil prices initially rose slightly in trading yesterday, but came under enormous pressure following the announcement that the US government was planning a comprehensive release of strategic oil reserves. Heating oil prices continue to fall.
Wednesday 03/30/2022 at 08:42
Oil prices plunged yesterday as Russia announced a reduction in military activity in kyiv. Meanwhile, futures have risen again, so heating oil prices only start slightly discounted today.