World oil prices

Oil prices extended gains from last week’s close, but the gains were modest, less than 30 cents, as markets weighed a deal to raise the U.S. debt ceiling that would avert a default by the world’s top oil consumer before further interest rate hikes by the Federal Reserve could curb energy demand.

Gasoline prices are heading for a third consecutive week of increases. Illustration photo: Reuters

Brent crude for July delivery rose 12 cents, or 0.2%, to $77.07 a barrel, while U.S. West Texas Intermediate (WTI) crude rose 25 cents, or 0.3%, to $72.92 a barrel.

According to Reuters , both benchmarks fluctuated between positive and negative territory. Trading on May 29 was down due to a public holiday in the UK and the US.

“Excitement over the debt deal is fading as concerns about another Fed rate hike in June grow,” brokerage Liquidity Energy LLC said in a note.

Over the weekend, US President Joe Biden and House Speaker Kevin McCarthy reached an agreement in principle to raise the $31.4 trillion debt ceiling and cap government spending over the next two years. Both leaders expressed confidence that both Democratic and Republican lawmakers would support the deal.

However, analysts say any oil price increase from the deal's impact will be short-lived.

Markets are now pricing in about a 50-50 chance of the Fed raising rates by 25 basis points at its June 13-14 meeting, up from the 8.3% chance predicted a month ago, according to the CME's FedWatch Tool.

At its policy meeting earlier this month, the Fed signaled it was ready to pause its most aggressive rate hike cycle since the early 1980s in June. However, strong economic data has reinforced the case that the Fed will extend the rate hike into June.

“Higher US interest rates will be a headwind for crude demand,” said analyst Tony Sycamore at IG Sydney.

Oil prices rose, weighed down by a weaker dollar as a debt ceiling deal dampened risk appetite in global markets and dented the safe-haven appeal of the asset.

Gasoline prices are continuing to rise. Illustration photo: Reuters

OPEC+ will meet on June 4. Just before the meeting, conflicting comments from Saudi Arabian Energy Minister Abdulaziz bin Salman and Russian officials, including Deputy Prime Minister Alexander Novak, on whether to reduce or maintain the organization's production caused oil prices to fluctuate up and down.

Craig Erlam, senior market analyst at OANDA, said Saudi Arabia may want to keep traders on their toes, but making comments (warning bears to watch out) and not following through could send prices “cooling down” further.

Domestic gasoline prices

Domestic retail prices of gasoline on May 30 are as follows:

E5 RON 92 gasoline is not more than 20,488 VND/liter.

RON 95 gasoline is not more than 21,499 VND/liter.

Diesel oil not more than 17,954 VND/liter.

Kerosene not more than 17,969 VND/liter.

Fuel oil not exceeding 15,158 VND/kg.

Last week, world oil prices marked the second consecutive week of increase. Notably, prices have continued to increase in recent days. Therefore, it is likely that domestic oil prices will be adjusted upward in the next price adjustment period of the Ministry of Finance - Ministry of Industry and Trade.

MAI HUONG