Brent crude futures slid 19% in May, marking the largest monthly drop since 2020 and pushing gas pump prices down as global oil slipped over 20%. US shale drilled‐but‐uncompleted well stock fell to a record low, constraining potential output even as Exxon and Chevron warn of $160/barrel targets.
Brent crude futures plunged 19% during May, the steepest monthly decline since 2020, as oil prices tumbled over 20% on fading conflict-driven premiums. This slump has translated into lower gasoline pump prices, reflecting reduced commodity costs in downstream markets.
US shale producers entered June with the smallest drilled-but-uncompleted well inventory on record, limiting their capacity to ramp up crude output quickly. This backlog constrains supply response as surging exports and refinery processing aim to offset drawdowns from recent inventory depletion.
Executives at Exxon and Chevron project oil could surge back to $160 per barrel within weeks, citing historic lows in crude and gasoline inventories that have reached operational floors. These forecasts underscore the tension between current price weakness and underlying supply tightness.
The United States Brent Oil Fund tracks these price moves directly, meaning its net asset value has mirrored the 20% price swings this month. Investors should consider the dual forces of steep declines and potential rapid rebounds as BNO navigates volatile Brent markets.
Forbes
