There is a continuous decline in the prices of crude oil. The special thing is that the price of crude oil in the international market has fallen below $ 70 per barrel. Yes, American crude prices are trading below $70. Despite this, the US reserves have fallen to a 12-year low. The special thing is that in the month of June, the prices of American crude have decreased 13 days out of 19 trading days.
According to Reuters report, due to peace talks between America and Iran and resumption of movement of ships through the Strait of Hormuz, there is a decline in the prices of crude oil. On the other hand, crude oil of Gulf countries is seen at pre-war level. Below $73 per barrel is visible. Which is the level before 27th February.
In such a situation, it can be said that in the coming days, common people may see relief in the prices of petrol and diesel. Let us also tell you at what level the price of crude oil is visible in the international market.
In the international market, American crude oil prices are seen trading below $70. If we look at the data, on Thursday the price of WTI was trading at $ 69.35 per barrel with a decline of 1.41 percent. The special thing is that this is the lowest level of American crude after March 2. The special thing is that after June 1, there has been a decline of 25 percent in the price of American crude. In fact, in the month of June, the price of American crude has seen a decline in 13 out of 19 trading days, which is a big decline.
US crude oil prices fell below $70 a barrel on Wednesday as tankers resumed transit through the Strait of Hormuz, Reuters reported, while stocks at the country's crude storage hub in Cushing, Oklahoma fell to their lowest level in 12 years.
The US Energy Information Administration said on Wednesday that oil stocks in Cushing fell to about 19 million barrels last week, the lowest level since 2014. Despite this, the price of 'West Texas Intermediate' (WTI), the benchmark used to determine the price of domestic crude oil, has fallen to $ 69 per barrel.
On the other hand, crude oil of Gulf countries is trading at pre-war level. If we look at the data, on Thursday the price of Brent crude is trading at $ 72.86 per barrel with a decline of 0.75 percent. Which has been seen for the first time after 26th February. If we talk about the month of June, since the 1st, the prices of crude oil in Gulf countries have come down by more than 23 percent. The special thing is that out of 19 trading days of June, there was a decline in the price of Brent crude on 11 days. Due to which the prices of crude oil are seen at pre-war level.
According to experts, the main reason for the fall in crude oil prices is the opening of the Strait of Hormuz and the US license to supply Iranian oil to the market for two months. On the other hand, other players in the Middle East have also announced to increase their supply along with increasing production. Due to which the prices of crude oil are seen coming down rapidly.
Inventory in Cushing, one of the world's largest storage hubs, generally reflects supply conditions, and any shortages could send prices soaring. US crude prices had soared to $119.48 a barrel since the US-Israeli war began in late February, but oil withdrawals from the government's Strategic Petroleum Reserve have helped stem the surge.
Carl Larry, sales manager at energy market analytics company Enverus, said that in reality, prices should have been higher given the condition of Cushing, the replacement of lost barrels and difficulties in transit through the Strait of Hormuz.
Larry further said that the fall in prices is mainly the result of sellers' sentiment. Money that is trying to push futures prices lower in order to find weak support levels and take advantage of a subsequent price rebound.
Strong export demand from the US Gulf Coast and low supply of imported crude from Canada due to sudden production stoppage from there have reduced the stocks accumulated in Cushing. Now this stock has fallen below the level of 20 million barrels which traders and analysts consider minimum for normal functioning.
When the amount of oil in a tank in Cushing falls below 10 percent or 20 percent of its capacity, it becomes difficult to drain it. This also raises quality concerns as water and sediments often accumulate at the bottom of the storage tank.
The withdrawal of oil from its emergency reserve by the US government has supported supplies across the country. This step is part of the government's agreement under which 172 million barrels of oil is to be extracted from these facilities to make up for the shortfall in global supply during the Iran War and control prices.
Analysts of research firm 'Energy Aspects' said last week that due to low demand for oil extraction and export from the Strategic Petroleum Reserve, the supply situation in the US Gulf Coast looks quite good.
According to EIA data, Gulf Coast inventories stood at about 239.8 million barrels at the end of last week, the lowest since mid-February (before the war began). US exports have fallen to about 4.7 million barrels per day (bpd) after reaching a record 6.4 million barrels per day (bpd) in April. A senior trader said that the market understands that now the excess oil (marginal barrels) is being exported from the Gulf Coast and not from Cushing.
However, there has been no increase in the prices of petrol and diesel in India since May 25. According to experts, the way crude oil prices are falling, it is estimated that the freeze button will remain pressed on the prices of petrol and diesel. The price of petrol and diesel in Delhi is Rs 102.12 and Rs 95.20 per liter respectively.
The price of petrol in Kolkata is Rs 113.51 and the price of diesel is Rs 99.82 per liter. In Mumbai, the prices of petrol and diesel are seen at Rs 111.21 and Rs 97.83 per liter respectively. Whereas in Chennai the price of petrol has come to Rs 107.77 and diesel to Rs 99.55 per liter. However, in the month of May, there was an increase of 7 to 8 percent in fuel prices.
