Futures Movers: Global oil prices eye first monthly gain of the year, as well as a 4th straight quarterly decline

Price action

• West Texas Intermediate crude for August delivery
  CL00,
  +1.40%

  CL.1,
  +1.40%

  CLQ23,
  +1.40%
  rose 72 cents, or 1%, at $70.58 a barrel on the New York Mercantile Exchange, on track for the highest front-month finish in more than a week. In Friday dealings, it trades over 3% higher for the month, but also more than 6% lower for the quarter.

• August Brent crude
  BRNQ23,
  +0.90%,
  the global benchmark, added 54 cents, or 0.7%, at $74.88 a barrel on ICE Futures Europe, with the front-month contract up over 3% for the month and down nearly 6% for the quarter. September Brent
  BRN00,
  +1.53%

  BRNU23,
  +1.53%,
  which becomes the front month at the session’s end, climbed 86 cents, or 1.2%, to $75.37 a barrel.

• Back on Nymex, July gasoline added 0.4% to $2.6271 a gallon, while July heating oil rose 1% to $2.4389 a gallon. The July contracts expire at the day’s settlement.

• August natural gas
  NGQ23,
  +2.37%
  rose 1.1% to $2.731 per million British thermal units.

Market drivers

Oil futures were headed for monthly gains but WTI was set for a second consecutive quarterly decline — off 7.7% through Thursday’s close — and Brent was headed for a fourth straight quarterly loss — down 6.8%.

“Like most assets, right now oil is beholden to the economy,” analysts at Sevens Report Research wrote in Friday’s newsletter.

Read Fourth of July gas prices: What drivers should expect amid record travel numbers

“If the soft landing (or even no landing) occurs, then that will be a solid tailwind on oil and other industrial commodities and country oversupply fears,” they said. “If a hard landing looks more likely in [the second half of the year], then a sharp drop in oil isn’t out of the question given oversupply concerns,” especially from Russia, which is pumping as much as they can to fund the war.

“Bottom line, the commodity complex remains in search of a positive catalyst to stop the slide, and if global growth truly holds up, then increased global demand will be that catalyst for a positive turnaround in commodities,” the Sevens Report analysts said.

Read: The U.S. will soon be in a recession, based on commodity price declines: strategist

Looking ahead, U.S. data due next week includes readings from purchasing managers and the June jobs report, but the figures are unlikely to dispel the widespread gloom, said Barbara Lambrecht, commodity analyst at Commerzbank, in a note.

“After all, even if sentiment were to have brightened in the manufacturing and service sectors, market participants would only interpret this as meaning that the Fed will have room to step on the brakes to a greater extent,” she wrote. “In turn, this would result in oil demand weakening — admittedly not in the short term, but with an increased probability in the medium term.”