Oil Rises on Week Despite Weight of New U.S. Tariffs


   
Barani Krishnan
DTN Refined Fuels Market Reporter

   SECAUCUS, NJ (DTN) -- Oil and product futures slid Friday (7/24) as energy 
futures markets responded to latest import tariffs by the Trump administration 
that could crimp global trade. For the week though, crude to distillate prices 
rose, extending their multiweek gains on continued escalation in the Middle 
East conflict.

   NYMEX WTI crude for September delivery fell $2.88 to settle at $89.31 bbl. 
On ICE, Brent for September closed down $3.91 at $96.78 bbl.

   Those drops came after the Trump administration announced on Thursday (7/23) 
fresh tariffs to replace the expiring ones knocked down by the Supreme Court in 
February. The new duties ranging from 10 to 12.5% amplified concerns on 
economic growth and additional inflationary pressure that could make interest 
rate cuts less likely.

   For the week, both WTI climbed about 8% while Brent rose almost 10% each. 
The U.S. crude benchmark posted a third consecutive week of gains, hitting a 
two-month high of $87.01 bbl Thursday. The global indicator for crude fourth 
rose for a fourth straight week, peaking at $102 bbl in the prior session.

   Downstream on NYMEX, ULSD futures for August delivery slumped $0.1610 to 
settle at 4.1806 gallon, while August RBOB retreated $1.374 to close at $3.3959.

   For the week, futures of ULSD rose 3% while those for gasoline were 
virtually flat.

   The US dollar index edged higher by 0.024 points to 101.310 against a basket 
of currencies.

   The weekly surge in crude and product pricing came after attacks on Saudi 
tankers by Iran's allies in Yemen that threatened to disrupt supply rerouted 
from the locked-in Persian Gulf to Saudi Arabia's Red Sea port of Yanbu.

   Supply disruptions are also mounting outside of the Middle East. Ukrainian 
drone attacks on tankers loading in the Russian Black Sea port of Novorossiysk 
forced shut loading operations of Kazakh oil, affecting some 1.2 to 1.5 million 
bpd in exports.  The longer those operations stay idle, the more Caspian Sea 
production will likely be curbed, given the lack of alternative takeaway 
options and limited storage capacity.




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