U.S. oil ends slightly lower with Biden administration seen still weighing export ban

Oil futures fell slightly on Tuesday after U.S. Secretary of Energy Jennifer Granholm said the Biden administration had not ruled out a ban on oil exports.

Price action
  • West Texas Intermediate Crude for July Delivery CL.1,


    it fell 52 cents, or 0.5 percent, to $ 109.77 a barrel on the New York Stock Exchange.

  • July Brent crude BRN00,
    + 0.23%

    + 0.23%,
    the world benchmark index rose 14 cents, or 0.1 percent, to $ 113.56 a barrel on ICE Futures Europe.

  • Back to Nymex, June RBM22 Gasoline,
    + 0.15%
    rose 0.4% to $ 3.811 a gallon, while in June HOM22,
    + 0.42%
    gained 0.3% to $ 3.7818 a gallon.

  • June NGM22 natural gas futures,
    + 0.66%
    ended with a gain of 0.6% to $ 8.796 per million British thermal units.

Market drivers

Granholm, speaking to reporters in Louisiana, was asked if the Biden administration was lifting restrictions on oil exports to put a cap on gasoline and diesel prices. “I can confirm that the president is not taking any tools off the table,” Granholm told Reuters.

Oil has found support in optimism over plans to undo long-term confinements in Shanghai, China’s largest city, but uncertainty remains over the world’s largest oil importer’s demand, as Beijing increase quarantine efforts in an effort to stop a COVID-19 outbreak. Chinese Vice Premier Sun Chunlan said the situation in Beijing was manageable, but such containment efforts could not be alleviated, Reuters was quoted as saying by Xinhua, the state news agency.

“The oil market is still caught between fears of recession and the aftermath of the zero-COVID policy in China, on the one hand, and stagnant supply, especially of oil products, along with the prospect that U.S. gasoline demand rebounded during the summer driving season. “Carsten Fritsch, a commodity analyst at Commerzbank, said in a statement.

Tight U.S. gasoline and diesel supplies have sent both prices on record, although gasoline futures were down on Tuesday. Gasoline demand is expected to increase as the summer driving season begins with Memorial Day weekend.

Investors continue to monitor the European Union’s efforts to agree on a plan to phase out imports of Russian oil and other energy in response to Hungary’s demand for increased EU support to help it transition to other countries. sources.

The weakness of the equity markets has been a friction in crude oil, with large sales that have killed appetite for other assets perceived as risky. US stocks were under renewed pressure on Tuesday following a rebound on Monday.

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