World oil prices

Oil prices were little changed in trading on June 23. According to Reuters , oil prices fell less than 50 cents, reinforcing the decline in oil prices this week, as traders worried that rising interest rates could reduce demand despite signs of tighter supplies.

Gasoline prices hit a weekly decline. Illustration photo: Reuters

Brent crude fell 29 cents, or 0.4%, to $73.85 a barrel. U.S. West Texas Intermediate (WTI) crude fell 35 cents, or 0.5%, to $69.16 a barrel.

Brent crude fell about $3 in the previous session after the Bank of England raised interest rates by half a percentage point, more than double expectations, to 5%. Central banks in Norway and Switzerland also raised rates.

For the week, the two oil benchmarks fell more than 3.5%, posting weekly losses, reversing last week's gains.

Meanwhile, the US Federal Reserve (Fed) is still leaving open the possibility of raising interest rates. According to Reuters , after the Fed's decision to keep interest rates unchanged this month, there is a high possibility of more interest rate hikes in the US. After the Fed Chairman's comments on this possibility, the comment from San Francisco Fed President Mary Daly that two more interest rate hikes this year is a "very reasonable" prediction further strengthens the prediction that the Fed will raise at least 50 basis points in the rest of the year.

There appears to be a growing “hedging” trade in crude oil, triggered by rising interest rates in the European Union (EU) and numbers coming out of China, said Dennis Kissler, senior vice president of trading at BOK Financial.

The Bank of England's rate hike has triggered fund liquidations and energy producers are shifting to a "risk-off" mentality, Kissler added.

Typically, higher interest rates increase borrowing costs for businesses and consumers, which can slow economic growth and reduce demand for oil.

Investor risk aversion also boosted the value of the dollar, putting pressure on oil prices.

Also according to Reuters , survey data showed that US business activity fell to a three-month low this month as service growth slowed for the first time this year and the contraction in the manufacturing sector deepened.

Wall Street's major indexes also fell, while gold prices were on track for their biggest weekly decline since early February.

China's promising economic recovery has stalled for several months in a row, with data on the East Asian nation's property market, manufacturing and consumer spending also coming in weaker than expected.

However, recession fears and demand have outweighed signs of tightening on the supply side.

U.S. energy firms this week cut the number of rigs drilling for oil for an eighth straight week, energy services firm Baker Hughes Co (BKR.O) said. The U.S. oil rig count, an indicator of future output, fell by six to 546 this week, the lowest since April 2022.

After a week of climbing, gasoline prices returned to a downward trajectory this week. Illustration photo: Reuters

The US Energy Information Administration (EIA) report this week also showed that US crude oil reserves unexpectedly fell by 3.8 million barrels last week.

Next month, Saudi Arabia will cut production by another 1 million barrels per day, along with voluntary production cuts by some OPEC+ members that will last until the end of next year, making supplies increasingly tight.

Money managers increased their long positions in U.S. crude oil futures and options contracts in New York and London by 4,790 contracts to 78,064 in the week to June 20, the U.S. Commodity Futures Trading Commission (CFTC) said on June 23.

Domestic gasoline prices

Domestic retail prices of gasoline on June 24 are as follows:

E5 RON 92 gasoline is not more than 20,878 VND/liter.

RON 95 gasoline is not more than 22,015 VND/liter.

Diesel oil not more than 18,174 VND/liter.

Kerosene not more than 17,956 VND/liter.

Fuel oil not exceeding 14,587 VND/kg.

The domestic gasoline prices mentioned above were adjusted at the price management session of the Ministry of Finance - Industry and Trade on the afternoon of June 21, with gasoline prices remaining unchanged, diesel and kerosene prices increasing slightly by less than 150 VND/liter, while mazut prices decreased by 132 VND/kg.

Since the beginning of the year, gasoline prices have undergone 18 adjustments, of which 9 have increased, 6 have decreased, and 3 have remained unchanged.

MAI HUONG