The ICP In July 2022 Drops To 106.73 US Dollars Per Barrel

Illustration (Photo: Doc. Antara)

JAKARTA - The Ministry of Energy and Mineral Resources (ESDM) announced that the average ICP of Indonesian crude oil in July 2022 fell by 10.89 US dollars per barrel from 117.62 US dollars per barrel to 106.73 US dollars per barrel.

Factors influencing the decline in world oil prices, among others, increased global crude oil supply in June compared to the previous month's production.

"The average price of Indonesian crude oil for July 2022 is set at 106.73 US dollars per barrel," reads the fourth dictum of the Decree of the Minister of Energy and Mineral Resources Number 111.K/MG.03/DJM/2022 concerning Indonesian Crude Oil Prices in July 2022 which is set for August 1, 2022.

Quoted from the Executive Summary of the Indonesian Crude Oil Price Team, the average price of main crude oil in July 2022 compared to June 2022 decreased, among others related to world crude oil supply, namely, first, OPEC in its July 2022 report that global crude oil production in June increased by an average of 1.32 million BOPD to 99.82 million BOPD compared to the previous month's production.

Second, the IEA reported in July 2022 that world oil supply jumped 690 thousand BOPD to 99.5 million BOPD in June compared to the previous month's production.

Third, OPEC's decision to maintain its policy of increasing production in July and August of 648.000 BOPD each.

Another factor is OPEC in its July 2022 Report that projected world oil demand in the 2nd quarter of 2022 to fall by 0.2 million bopd compared to the previous publication.

In addition, the increase in oil stocks in the United States based on EIA data for the same period as the previous month, crude oil stocks amounted to 3.4 million barrels from the previous 418.7 million barrels to 422.1 million barrels.

then gasoline stock is 7.6 million barrels, from the previous 217.5 million barrels to 225.1 million barrels.

"Finally, the stock of distillate is 2.0 million barrels, from the previous 109.7 million barrels to 111.7 million barrels," said Head of the Communications, Public Information and Cooperation Bureau (KLIK) of the Ministry of Energy and Mineral Resources Agung Pribadi in an official statement, Wednesday, August 3.

He continued, the decline in world crude oil prices during July 2022 was also influenced by a decline in the rate of global economic growth, among others, the IMF delivered a correction to its forecast for global economic growth in 2022 to 3.2 percent from the previous estimate in April of 3.6 percent.

Second, the US Federal Reserve officially raised interest rates by 75 basis points for the second month in a row delivering the most aggressive tightening in more than a generation.

Third, the concerns of market participants over the world recession, high inflation, the ongoing pandemic and monetary tightening.

Meanwhile, for the Asia Pacific region, the decline in crude oil prices was also influenced by the Chinese government's policy to tighten social restrictions in several regions in an effort to prevent the spread of COVID-19, resulting in market concerns about a decline in crude oil demand.

"In addition, the condition of South Korea experiencing inflation in June at the highest level for almost 24 years, this has become a concern for market players regarding the slowdown in economic growth and oil demand," the exsum said.

The complete development of the average price of main crude oil in July 2022 compared to June 2022 is as follows:

• Dated Brent fell by 11.00 US dollars per barrel from 123.70 US dollars per barrel to 112.70 US dollars per barrel.
• WTI (Nymex) fell by 14.96 US dollars per barrel from 114.34 US dollars per barrel to 99.38 US dollars per barrel.
• Brent (ICE) fell by 12.38 US dollars per barrel from 117.50 US dollars per barrel to 105.12 US dollars per barrel.
• The OPEC basket fell by 9.34 US dollars per barrel from 117.83 dollars per barrel to 108.49 US dollars per barrel (up to 29 July 2022).