Oil prices start last week of June little changed, on pace for monthly gain

Crude oil futures kicked off the last week of June little changed but are on pace to post a gain for the month, as signs point to strengthening gasoline demand in the US.

Oil prices pulled back Friday, snapping a recent winning streak, but closed out the week nearly 3% higher. West Texas Intermediate and Brent are on pace for a monthly gain of 5.21% and 4.7%, respectively.

U.S. crude oil booked its worst month of the year in May, but prices have bounced back on hopes that the market will tighten on summer fuel demand.

Here are today’s energy prices:

• West Texas Intermediate August contract: $80.88 per barrel, up 15 cents, or 0.19%. Year to date, U.S. oil is up 12.9%.
• Brent August contract: $85.39 per barrel, up 15 cents or 0.18%. Year to date, the global benchmark is ahead 10.9%.
• RBOB Gasoline July contract: $2.507 per gallon, down 0.23%.  Year to date, gasoline is up 19.2%.
• Natural Gas July contract: $2.68 per thousand cubic feet, down 0.85%. Year to date, gas has gained 6.6%.

“The chief underlying reason behind the price strength, nonetheless, is the growing confidence that global oil inventories will inevitably plunge during the summer in the northern hemisphere,” Tamas Varga, analyst with oil broker PVM, said in a note Monday.

Goldman Sachs, JPMorgan and Citi have all forecast that inventories should start to fall on fuel demand OPEC+ maintaining output cuts until October.

U.S. oil, gasoline, and distillate inventories fell for the week ending June 14, the most recent available data. JPMorgan said gasoline consumption had surged to 9.4 million barrels per day that same week, the highest level for the period since the pandemic ended.

Ryan McKay, senior commodity strategist at TD Securities, said the recent rally could fade as commodity trading advisors ease up on buying. U.S. crude oil has fallen below $81.73 per barrel, which McKay argued could cause traders to liquidate some of the long positions they have build up.