DTN Oil Update
Oil Futures Gain on Limited Supply Outlook
HOUSTON (DTN) -- The NYMEX WTI futures contract for January delivery and February Brent futures contract remained bullish Friday, closing with gains over $1 on the day, as additional sanctions on Russia could lead scarce availability of Russian crude and oil products in the global markets.
This week, EU ambassadors announced a 15th package of sanctions against Russia by adding more persons and entities to the already existing sanctions list and targeting shadow fleet that Russia uses to evade restrictions on transporting oil and fuel.
With the hike in oil futures prices Friday, the market seems to have discounted the outlook for slow global demand in 2025 as forecasted by OPEC and the International Energy Agency in two separate reports this week.
Meanwhile, attention next week will be centered on the Federal Open Committee meeting, where the Federal Reserve could cut interest rates by 25 basis points after the 0.7% increase in November, the Consumer Price confirmed that the inflationary pressures continue.
On industry news, latest data from Baker Hughes showed that the number of rigs in the U.S. actively drilling for oil remained at 482 as of Friday, 19 fewer than a year earlier. The number of U.S. natural gas rigs in operation held to the upside, rising one to 103 as of Friday. Currently, there are 16 fewer natural gas rigs in operation than during the same week in 2023, the same data showed.
Canada-based Suncor Energy said it aims to grow its upstream production around 810,000-840,000 bpd and its refining utilization of 93% to 97% next year. For 2025, the operator anticipates adding over 100,000 bpd to its output from 2023 to 2026, with refining margins based on a crack spread of $22 bbl for New York Harbor and $18 bbl for Chicago.
Airlines for America (A4A) also projects U.S. airlines will see record air travel throughout the holiday season, expecting more than 54 million passengers to fly from Thursday, Dec. 19 to Monday, Jan. 6. A4A earlier this week said U.S. carriers are prepared to fly more than 2.8 million passengers per day on average, an increase of 6% from last year's holiday period.
At 3:06 p.m. EST, January NYMEX WTI futures climbed by $1.20 to $71.22, while February Brent future rose $1.06 to $74.47 bbl. The front-month ULSD futures contract edged up $0.0325 to $2.2691 gallon, while January RBOB for January delivery edged up $0.0114 to $1.9999 gallon.
Maria Eugenia Garcia can be reached at Maria.Garcia@dtn.com
