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Crude oil futures posted a second straight weekly loss, characterized by big swings as geopolitical risk perceptions waxed and waned in the Middle East as Israel and Iran traded blows that caused little damage and were considered unlikely. trigger a larger conflict.
Crude oil jumped more than 3% in early trading Friday on news that Israel launched a retaliatory attack on Iran, but then retreated on signs of easing, hitting its lowest level in more than two weeks.
The barrage of Iranian missiles and drones against Israel last weekend was widely discounted by investors, but uncertainties over Israel’s response kept the market on edge throughout the week.
But oil hasn’t really recovered because “there has been no increase in risk to high-producing countries in the region” with Saudi Arabia, the United Arab Emirates and Iraq staying out of the conflict, Gary said Cunningham of Tradition Energy MarketWatch. “In reality, only Iran’s barrels are at risk, and that would only happen if broader hostilities erupted.”
Front-month Nymex crude oil (CL1:COM) for May delivery has been established -2.9% for the week at $83.14 a barrel, and June 1 Brent crude (CO1:COM) closed -3.5% at 87.29 dollars a barrel; both benchmarks posted modest gains on Friday, up 0.5% and 0.2% respectively.
Additionally, May-early natural gas Nymex (NG1:COM) closed the week -1% at $1,752/MMBtu.
ETFs: (NYSEARCA:USE), (BNO), (UCO), (SCO), (USL), (DBO), (DRIP), (GUSH), (NRGU), (USOI), (UNG), (BOIL), (COLD), (UNL), (FCG)
Global demand indicators were mixed on the week, with US crude inventories falling, rising by a much larger-than-expected 2.7 million barrels, while China’s first-quarter gross domestic product rose 5.3 % y/y, beating expectations and sending a bullish signal to oil markets. .
The energy sector, as indicated by the Energy Select Sector SPDR ETF (NYSEARCA:XLE), concluded the week -1.2%.
Top 5 Gains in Energy and Natural Resources in the Last 5 Days: Drilling Tools International (DTI) +11.9%Eco Wave Power (WAVE) +10.8%Cross Timbers Royalty Trust (CRT) +10%Spruce Power (SPRU) +9.8%Silvercrest Metals (SILV) +9.5%.
Top 5 declining countries in the energy and natural resources sector in the last 5 days: Lithium Americas (LAC) -33.2%Critical Metals (CRML) -26.9%BP Prudhoe Bay Royalty Trust (BPT) -21.9%Marine oil (MARPS) -20.8%US Gold Mining (USGO) -16.9%.
Source: Barchart.com