U.S. crude caps biggest monthly rise since January 2022; Goldman hikes demand outlook - Seeking Alpha
U.S. crude caps biggest monthly rise since January 2022; Goldman hikes demand outlook | Seeking Alpha
U.S. crude caps biggest monthly rise since January 2022; Goldman hikes demand outlook
SlavkoSereda
U.S. crude oil prices climbed to fresh three-month highs Monday and posted their best monthly gains in a year and a half, supported by tightening global supply and rising demand.
Front-month Nymex crude ( CL1:COM) for September delivery closed +1.5% Monday and gained 15.8% this month to $81.80/bbl, while September Brent crude ( CO1:COM) finished +0.6% on the day and added 14.2% for July to $85.56/bbl.
Both WTI and Brent have enjoyed a string of five straight weekly gains, with WTI turning positive on the year, +1.9%, while Brent is still a bit shy of breakeven YTD, -0.4%.
ETFs: (NYSEARCA: USO), ( BNO), ( UCO), ( SCO), ( DBO), ( SCO), ( DRIP), ( GUSH), ( USOI), ( NRGU), ( XLE), ( XOP), ( VDE), ( OIH) ( XES), ( IEZ)
The strength in crude prices helped lift energy stocks to their best monthly showing since October, +7.7%; the sector was the comfortable leader on Monday, +2%, also helped by Goldman Sachs' upgrade of Chevron (NYSE: CVX), which ended +3%.
Goldman also upwardly revised its global oil demand forecast for the year while sticking to its 12-month Brent price projection of $93/bbl, as higher realized inventories offset the demand boost from a less pessimistic growth outlook.
Goldman analysts estimate global oil demand rose to an all-time high of 102.8M bbl/day in July and anticipate solid demand driving a larger than expected 1.8M bbl/day deficit in this year's H2 and a 600K bbl/day deficit in 2024.
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Related Knowledge Center: ENERGY BASICS: petroleum
While electric-powered vehicles may be the ride of the future, oil remains at least for now the dominant fuel for transportation around the world. And after a period of time at the end of the 20th century when oil was subject to wide fluctuations in price, new supplies in North America as a result of non-conventional recovery techniques have helped stabilize prices.