- WTI crude oil in New York climbs six of last seven weeks
- Falling U.S. output, wildfires in Canada prompt weekly gain
Oil fell as the expiration of the June contract in New York spurred selling by traders who don’t intend to take delivery of barrels next month.
West Texas Intermediate for June expired after falling 0.9 percent. Futures are still up for the week amid lower U.S. crude production and supply disruptions in Canada and Nigeria. U.S. crude output slid for a 10th week to the lowest since September 2014 as gasoline use climbed ahead of the summer-driving season, the Energy Information Administration said Wednesday.
"The weakness was focused in the expiring June contract where we got some late long liquidation," said Tim Evans, an energy analyst at Citi Futures Perspective in New York. "Today’s move doesn’t give you a clue to what July will trade at on Monday."
Oil has surged more than 80 percent since slumping to the lowest in 12 years in February on signs the global glut will ease as U.S. production falls. The market moved into a deficit earlier than expected following supply disruptions in Nigeria and an increase in demand, according to Goldman Sachs Group Inc.
WTI for June delivery declined 41 cents to settle at $47.75 a barrel on the New York Mercantile Exchange. Futures increased 3.3 percent this week. Total volume traded was 27 percent below the 100-day average at 3:02 p.m. The more-active July contract fell 26 cents to $48.41.
Brent for July settlement decreased 9 cents to $48.72 a barrel on the London-based ICE Futures Europe exchange. The contract climbed 1.9 percent this week. The global benchmark crude closed at a 31-cent premium to July WTI.
"Traders, myself included, are just trying to make money," said Thomas Finlon, director of Energy Analytics Group LLC in Wellington, Florida. "The market posted a good-sized gain this week and there wasn’t a lot of news today so traders booked profits."
U.S. crude production fell to 8.79 million barrels a day last week, according to EIA data. Gasoline consumption averaged 9.56 million barrels a day in the four weeks ended May 13, the highest seasonal level in at least a decade. Nationwide crude stockpiles unexpectedly increased, keeping them near the most in more than eight decades.
Firefighters successfully defended Suncor Energy Inc. and Syncrude Canada Ltd.’s oil-sands operations and rain brought some relief, while the blaze spread into remote forests to the east. Alberta officials are counting on cool, humid weather in the coming days to help them better contain the fire and allow them to lift evacuation orders affecting some of the biggest production sites.
- More than 50 percent of workers at Total SA’s Gonfreville refinery in France have voted to go on strike and will negotiate a shutdown of the plant with management, according to the CGT Union.
- Iraq’s output has probably peaked and is likely to fall short of the country’s target over the next two years, according to an official with Lukoil PJSC, operator of one of the country’s biggest fields.
- Royal Dutch Shell Plc is in talks with potential buyers for some North Sea assets, mostly fields it got this year as part of the record acquisition of BG Group Plc, according to people familiar with the matter. BP Plc is said to be considering selling a stake in the Forties pipeline system.