Alaska North Slope crude busted higher into the upper $80s June 18, up a dollar to close at $86.62 per barrel as oil prices tested levels not seen since April. West Texas Intermediate jumped $1.24 to close at $81.57 and Brent gained $1.08 to edge above $85 for a close of $85.33.
Trading June 19 was limited due to the U.S. holiday of Juneteenth. WTI and Brent edged upward in early trading but later fell, closing at $81.37 and $85.07 respectively. ANS pricing was not available.
The holiday also pushed the release of U.S. petroleum reserves data published by the Energy Information Administration to June 20, beyond Petroleum News press time.
Analysts answering an S&P Global Commodity Insights survey predicted the EIA will report a drawdown of 4.1 million barrels from commercial crude oil inventories for the week ending June 14. The same survey called for motor gasoline inventories to rise 100,000 barrels, while distillates rise 280,000 barrels.
On June 18, ANS traded at a $5.05 premium to WTI and at a $1.29 premium over Brent.
ANS gained $1.98 over the holiday-shortened trading week from its close of $84.64 June 12 to $86.62 on June 18.
From its low for the month of $80.07 set June 4, ANS vaulted $6.55 to reach $86.62 on June 18. On June 4, WTI closed at $73.25 and Brent closed at $77.52.
OPEC+ production worries overblown
The June 4 lows were set in the wake of the 37th OPEC and non-OPEC Ministerial Meeting June 2, where the Organization of the Petroleum Exporting Countries and its allies delivered a widely expected extension of crude production cuts ' which would have pleased the markets were it not for a plan to phase out some of the cuts beginning in October.
The initial 'knee-jerk selloff' reaction to the June 2 OPEC+ decision was 'largely reversed and seen as overdone,' Tyler Richey, co-editor at Sevens Report Research told MarketWatch for a June 18 report, adding that OPEC+ leadership 'confirmed that they will remain flexible and only reduce their voluntary output cuts if market conditions warranted, and clarified increasing production is not necessarily a base-case expectation right now.'
'Evidence of strong domestic demand at the start of the U.S. summer driving season, rising geopolitical tensions overseas, and renewed hopes for a perfectly executed soft landing' by the Federal Reserve further supported the rebound, Richey said, but he warned that oil market sentiment is fragile.
'If we see any headlines that contradict any of those factors that have supported the latest rally, or even just an uptick in broad market volatility into the end of the quarter, we could see oil markets correct back towards the mid $70 a barrel range,' he said.
ANS leapt $1.57 June 17 to close at $85.62, while WTI lofted $1.88 to close at $80.33 and Brent leapt $1.63 to close at $84.25.
On June 14, ANS added 12 cents to close at $84.05, but WTI slid 17 cents to close at $78.45 and Brent slid 13 cents to close at $82.62.
ANS lost 70 cents June 13 to close at $83.94, as WTI added 12 cents to close at $78.62 and Brent added 15 cents to close at $82.75.
Geopolitics heat crude prices
Two Russian fuel depots southeast of Moscow were in flames June 20 after suspected Ukrainian drone attacks, according to a Reuters report.
Maxim Yegorov, governor of the Tambov region, said firefighters were fighting flames at the Platonovskaya fuel depot after explosions. No one was hurt, he said.
RIA news agency said a second reservoir was ablaze at the fuel depot.
Earlier in the day, a fuel depot in Russia's Adygeya region in the North Caucasus flared after a Ukrainian drone attack, but the fire is out, regional head Murat Kumpilov wrote on social media.
On June 17, oil storage tanks in the Russian town of Azov flared after a drone attack that a Ukrainian intelligence source told Reuters was conducted by the Security Service of Ukraine.
The local emergency service said June 19 the fire was raging after more than a day and a half.
A cargo ship sank in the Red Sea a week after it was damaged in a deadly sea drone attack by Yemen based Houthi rebels, British maritime authorities and salvagers said, according to a June 19 BBC article.
The Liberian-flagged Greek-owned bulk carrier ' The Tutor ' was struck on the stern.
The Tutor came under attack by a bomb-carrying Houthi drone boat in the Red Sea, John Kirby, White House national security spokesman said June 17, killing 'a crew member who hailed from the Philippines.'
The Tutor is thought to be the second ship sunk by the Iran-backed Houthis since November.
U.S. and European warships have been deployed since December as part of an international task force to protect commercial shipping in the waterway.
The United States and UK have carried out air and missile strikes on Houthi military targets in Yemen since January.
