Jakarta (Indonesia Window) – The recovery in global economic activities and high demands of crude oil have pushed up the Indonesian Crude Price (ICP) by 3.53 U.S. dollars per barrel, to 65.49 dollars per barrel in May from 64.69 dollars in April.

The Indonesian Ministry of Energy and Mineral Resources’ spokesperson, Agung Pribadi, explained that the easing of activities in the United States, China and parts of Europe also affected the world oil demands.

"The Indonesian oil price team reports that this economic growth is a positive impact of the acceleration of the vaccination program, which boosts global oil supplies and demands," Agung said here on Tuesday (June 8).

Report from the Organization of the Petroleum Exporting Countries (OPEC) in May 2021 showed high demands of oil from the United States in 2021 at 5.95 million barrels per day (bopd) or 6.6 percent compared to that in 2020.

That condition is in line with the U.S.’ plan to cancel sanctions against Iran, which led to the potential cancellation of Iran's crude oil exports.

Another factor that has contributed to increasing world oil prices is the compliance of OPEC+ members to cut the production quota of 113 percent.

In May 2021, the Energy Information Administration (EIA) estimated that the U.S.’ crude oil production in 2021 would decline by 290 thousand bopd to 11.02 million bopd.

Meanwhile, the EIA weekly report stated that U.S.’ crude oil inventories fell by 800 thousand barrels to 484.3 million barrels, gasoline inventories fell by 3.3 million barrels to 232.5 million barrels, and distillate inventories fell by 7.1 million barrels to 129.1 million barrels.

The Indonesian oil price team said that the strengthening of the equity market and the weakening of the U.S. dollar exchange rate against a number of currencies (the lowest in the last four months) have encouraged investors to switch their investments in commodities, including crude oil.

Meanwhile for the Asia Pacific region, the increase in crude oil prices was also influenced by rising oil demands from China towards the end of the maintenance period and solid oil demands from Japan, as well as Indian oil demands that remained strong, especially from refineries, despite a sharp increase in COVID-19. cases.

The following is the development of major crude oil on the international market in May 2021 compared to that in April 2021.

Dated Brent rose by 4.05 dollars per barrel, to 68.75 dollars per barrel from 64.70 dollars per barrel.

WTI (Nymex) rose by 3.45 dollars per barrel, to 65.16 dollars per barrel from 61.70 dollars per barrel.

The OPEC basket rose by 3.59 dollars per barrel, to 66.83 dollars per barrel from 63.24 dollars per barrel.

Brent (ICE) rose by 2.98 dollars per barrel, to 68.31 dollars per barrel from 65.33 dollars per barrel.

Reporting by Indonesia Window