Crude oil prices rebounded on the New York and London markets on Dec. 26 after having fallen drastically before the Christmas holiday. But oil prices fell again in early trading Dec. 27. Both crude oil benchmarks appear to be headed for losses of about 20% in 2018.
Dominic Schnider of UBS Wealth Management told CNBC that he believes “quite sharp gains” in crude oil prices are likely in 2019, boosting prices above $70/bbl. He also expects that “volatility will come down,” next year for oil prices.
“The [crude] market was simply spooked,” ending 2018 with lots of supply, Schnider said. He added that the Organization of Petroleum Exporting Countries “still is here and I think the market is underestimating” the market effect of oil production cuts starting in January 2019.
On Dec. 23, UAE Energy Minister Suhail al-Mazrouei said OPEC could schedule an extraordinary meeting if the 1.2 million b/d cut in oil production by OPEC and some non-OPEC producers does not balance the oil market.
His comment came during a news conference at the Organization of Arab Petroleum Exporting Countries (OAPEC) in Kuwait, Reuters reported.
The February light, sweet crude contract on the New York Mercantile Exchange rallied by $3.69 to close at $46.22/bbl on Dec. 26 while the March contract gained $3.72 to close at $46.54/bbl.
NYMEX natural gas futures for January climbed nearly 8¢ to close at $3.54/MMbtu on Dec. 26.
Ultralow-sulfur diesel for January gained 7¢ to $1.73/gal. The NYMEX reformulated gasoline blendstock for January increased 8¢ to a rounded $1.33/gal.
Brent crude oil for February gained $4 to $54.47/bbl on London’s International Commodity Exchange. The Brent contract for March gained $3.99 to $54.76/bbl.
The gas oil contract for January was $504.25/tonne on Dec. 26, down $9.75.
The average price for OPEC’s basket of crudes was unavailable for Dec. 26.
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