May 2022 Monthly Average Crude Oil Price

Click image for larger view

The monthly average U.S.-dollar price of West Texas Intermediate (WTI) crude oil rose by $7.77 (+7.6%) to $109.55 per barrel in May. That increase occurred within the context of a somewhat stronger U.S. dollar (broad trade-weighted index basis -- goods and services), the lagged impacts of March’s rise of 76,000 barrels-per-day (BPD) in the amount of petroleum products demanded/supplied (to 20.5 million BPD, and accumulated oil stocks that have edged higher while remaining well below the bottom of the five-year-average range (May average: 420 million barrels).

Click image for larger view

Selected highlights from the 31 May 2022 issue of OilPrice.com‘s Intelligence Report include:

“Oil prices are climbing once again on the news that the EU has agreed to a partial ban on Russian oil imports,” wrote Tom Kool. “Whilst Russia will almost inevitably see its production decline as a result of the ban, the general anticipation is that Asia, and especially China, will ramp up its purchases. The sanctions deal steepened backwardation in the markets, with the ICE Brent six-month spread shooting up $15 per barrel again -- not a good time to be hoarding inventories.”

The EU Creates Pipeline Exemption for Russia Sanctions. The European Union finally reached an agreement on Russian oil sanctions, aiming for a six-month phase-in period, giving a temporary waiver for crude oil delivered by pipeline, without specifying their wind-down period.

Russian Crude Production Rises Despite Sanctions Pressure. Media reports are suggesting that Russian oil production increased by 1% month-on-month and rose to 10.17 million b/d this month so far, implying that the 10 million b/d trough last month might be the low point of output.

Click image for larger view

For other oil-related headlines, see the 1 June 2022 edition of The Energy Bulletin Weekly.

The foregoing comments represent the general economic views and analysis of Delphi Advisors, and are provided solely for the purpose of information, instruction and discourse. They do not constitute a solicitation or recommendation regarding any investment.