.jpg)
In these three months oil prices have risen by over 30% with no clear end in sight. This week brings another round of traders trading on hope that a stalemate between the US and Iran can be resolved.
But uncertainty lingers, like some circular loop yours truly discussed in a recent Forbes post.
That's after oil prices headed lower this week (again) with Brent and WTI futures lower by more than10% on the previous week. Of course, last week they rose again, and so it goes.
While futures are reflective of prevailing market sentiment and its impact on prices, what is actually prevailing in the physical market - especially at the major Asian hubs - is a premium of as much as $20 per barrel, according to sources. Cargoes through the Strait of Hormuz remain disrupted and there is a scramble for alternatives.
Where this goes is contingent on news flow. Having said that Brent futures contracts six months out - i.e. December 2026 onward - do have prices in the $80-$85 per barrel range. So, should a deescalation continue, prices will come down. But it will still take better parts of the remainder of the year for the market to normalise potentially around Q1 2027 even if the geopolitical tension eases today.
Away from the oil price - energy major BP delivered another shocker with its board dispensing with Chairman Albert Manifold who was removed with immediate effect on May 26! The company that's currently on its fourth CEO in six years in Megan O'Neill, is now looking for another Chairman in less than eight months.
Hopes of BP's investors seeking a bit of calm have been dashed again. But they can perhaps rest assured that a return to oil and gas basics remains on track under new CEO O'Neill, according to statements issued in the wake of Manifold's departure. One can only hope!
Well that's all for the moment folks! More musings to follow soon. Keep reading, keep it here, keep it 'crude'!
No comments:
Post a Comment