U.S. crude oil edges lower after worst day in two years
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U.S. crude oil edged lower on Tuesday, one day after posting the worst daily loss in two years.
Energy traders have breathed a sigh of relief this week after Israel’s long-anticipated retaliatory strikes on Iran last Friday spared the Islamic Republic’s oil and nuclear facilities. The benchmark U.S. crude oil contract sold off more than 6%, or $4.40, to $67.38 per barrel on Monday.
But oil prices are too cheap in the near term compared with fundamentals, Goldman Sachs analyst Daan Struyven told CNBC’s “Squawk Box” on Tuesday, citing demand from refilling the U.S. Strategic Petroleum Reserve as well as from the airline industry.
Here are Tuesday’s closing energy prices:
- West Texas Intermediate December contract: $67.21 per barrel, down 17 cents, or 0.25%. Year to date, U.S. crude oil is down about 6%.
- Brent December contract: $71.12 per barrel, down 30 cents, or 0.42%. Year to date, the global benchmark has fallen more than 7%.
- RBOB Gasoline November contract: $1.9518 per gallon, down 0.74%. Year to date, gasoline has pulled back about 7%.
- Natural Gas November contract: $2.346 per thousand cubic feet, up 1.6%. Year to date, gas has lost more than 6%.
Goldman Sachs expects the price of Brent to recover to $77 per barrel in the fourth quarter even without any oil supply disruptions in the Middle East.
The risks, however, are skewed to the downside in 2025, Struyven said. Demand is soft in China, U.S. production is robust and OPEC+ has plans to bring crude back to the market in December.
