Oil prices fell amid growing pessimism over the outlook for demand against a backdrop of trade disputes, economic slowdown and a large US stockbuild. Atlantic basin marker North Sea Dated dropped to $62.42/bl, down by $5.49/bl in the week to 6 June. In the Mideast Gulf, August Dubai was down by $5.30/bl, at $59.12/bl, and US benchmark front-month WTI fell by $4/bl to $52.59/bl. North Sea Dated has not been so low since mid-February. The Brent and Dubai markets remain backwardated, with prompt contracts valued higher than those further forward, but the gradient of the market structure has eased. The premium of front-month Ice Brent futures to contracts six months ahead narrowed to $2.71/bl on 6 June from $4.34/bl at the end of May. This suggests concerns about physical crude tightness are easing. Backwardation effects were blunted by varying differential prices. Prompt Urals cargoes and other Atlantic basin crudes are valued lower against North Sea Dated than those further forward. Part of the reluctance to buy prompt Urals also comes from high organic chloride levels - around 4ppm against the 1ppm maximum that many buyers will tolerate - although these levels are beginning to subside.
展开▼
