US Crude Prices Ease Despite Robust Summer Demand and Hurricane Beryl Concerns

In the world of oil markets, every little shift can have a big impact on prices. This past Friday, US crude prices took a slight dip from a seven-week high, despite strong summer demand. West Texas Intermediate crude closed down, as did Brent crude, the global benchmark.

The drop in prices was attributed to a decrease in fears about potential damage to production facilities from Hurricane Beryl, which has now been downgraded to a tropical storm. While Beryl was expected to make landfall near the Texas and Mexico border, concerns remain about the potential for a disruptive hurricane season in the Gulf of Mexico.

Saxo Bank noted that Hurricane Beryl, along with ongoing geopolitical risks, have offset signs of demand weakness in Asia. Despite the slight drop in prices on Friday, oil prices have seen a 13% increase in the past month due to rising demand during the US summer driving season, falling American oil inventories, and tensions in the Middle East.

The rig use report from Friday was mixed, with no change in oil rig numbers for the first time in seven weeks, but a strong rise in gas rigs. Overall, there were 479 oil rigs and 101 gas rigs in operation in the US last week, with a total of 585 rigs in operation.

It’s clear that the oil market is a complex and ever-changing landscape, with multiple factors influencing prices on a daily basis. As we head into the peak of hurricane season and continue to monitor geopolitical tensions, it will be interesting to see how these factors continue to shape the oil market in the coming weeks.