On Thursday, June WTI crude oil closed down $1.81 (-1.69%) amid concerns that rising energy prices are negatively impacting demand and global economic growth. In contrast, June RBOB gasoline prices rose by $0.0228 (+0.63%), reaching a 3.75-year high. U.S. Q1 GDP growth came in at +2.0%, below expectations of +2.3%, while Eurozone Q1 GDP increased by +0.1% q/q, also underperforming forecasts.
President Trump was briefed on potential military actions against Iran, triggering an initial rise in crude prices. Reports indicate that U.S. Central Command is preparing a “short and powerful” strike plan, as the ongoing blockade of the Strait of Hormuz—critical for global oil transportation—has significantly disrupted oil supplies, with an estimated 14.5 million bpd curtailed in April. Goldman Sachs indicated a drawdown of 500 million barrels from global crude stockpiles, projected to reach 1 billion by June.
The UAE’s decision to exit OPEC effective May 1 raises concerns over potential increases in crude production, undermining efforts to stabilize prices. The International Energy Agency reports that roughly 13 million bpd of global oil supply has been affected by the Iran war and the blockade, while OPEC+ aims to increase production by 206,000 bpd in May, now uncertain due to ongoing conflicts.
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