A liquefied natural gas (LNG) tanker as seen from shore.
Doha, Qatar: Oil prices edged higher last Friday after the International Energy Agency forecast record global demand and tightening supplies, propelling prices to the seventh straight week of gains, the longest such streak since 2022.
Brent crude futures rose 41 cents, or 0.5%, to settle $86.81 a barrel, while US West Texas Intermediate (WTI) crude futures gained 37 cents, or 0.5%, to close at $83.19. On a weekly basis, both benchmarks rose about 0.5%.
The last time that Brent rose for seven straight weeks was in January-February 2022. The IEA estimated that global oil demand hit a record 103 million barrels per day in June and could scale another peak this month.
Meanwhile, output cuts from Saudi Arabia and Russia set the stage for a sharp decline in inventories over the rest of 2023, which IEA said could drive oil prices even higher. Meanwhile, the Organization of the Petroleum Exporting Countries (OPEC) said it expects global oil demand to rise by 2.44 million bpd this year, unchanged from its previous forecast, while prospects for the oil market look healthy for the second half of the year. US economic data last week also lifted market sentiment, fueling speculation that the Federal Reserve would end its aggressive rate hikes.
Asian spot liquefied natural gas (LNG) prices inched up last week as the prospect of possible industrial action at Australian LNG facilities sparked fears it would stoke competition between Asian and European buyers for cargoes.
The average LNG price for September delivery into north-east Asia rose to $11.50 per million British thermal units (mmBtu) from $10.90 the previous week, industry sources estimated.
However, many market players think that the issue will be resolved and if strikes proceed, they wouldn’t drag into winter.
In Europe, the gas market heading into October was already set to be finely balanced, due to very healthy storage levels. The front-month Dutch contract rose more than 20% on weekly basis to 11.54 per mmBtu.
The news of possible strikes at the Chevron and Woodside Energy Group Australian LNG facilities, which together supply about 10% of the global LNG market, led to a spike in prices last week. In the US, natural gas futures were little changed last Friday, as rising inventory offset support from forecasts for hot weather and higher cooling demand.
Front-month gas futures for September delivery settled at $2.77 per mmBtu, up by more than 7% on a weekly basis.
