Slight oil slip bucks trend of wild price swings as ship stuck in Suez Canal refloated

Tokyo — Oil was slightly lower on Monday, relatively placid after four sessions of wild swings in price, as the giant container ship clogging the Suez Canal was refloated and little new emerged in the demand picture.

Brent oil was down 18c, or 0.3%, at $64.39 a barrel by 3.41am. US crude fell 22c, or 0.4%, to $60.75 a barrel.

Both benchmarks are about where they were before the Ever Given became a household name after the container ship got stuck in a narrow portion of the canal last week.

Hundreds of other container ships, bulk carriers and oil-laden tankers are backed up at both ends of the canal as salvage teams intensified excavation and dredging to refloat the 400m ship.

“Each day that passes increases the oil on water rather than in the refinery for processing,” said Stephen Innes, chief markets strategist at axi. That “should help to retighten the physical market and stabilise prices”.

Oil prices rose more than 4% on Friday, capping a week of wild swings as traders and investors tried to weigh the impact of the blockage of a key trade transit point and the broader effect of lockdowns to stop coronavirus infections.

Prices are getting some support from expectations that Opec and its allies will maintain lower output levels when they meet this week.

Reuters