Crude Oil & Natural Gas Pricing: July’s average West Texas Intermediate (WTI) crude oil price per barrel decreased 12% month on month (m/m). The WTI is up 40% year on year (y/y), coming in at $101.62 / barrel in July 2022 vs. $72.49 / barrel in July 2021.

By comparison, Brent crude also decreased 9% m/m to $111.93 / barrel in July 2022, and experienced growth of +49% y/y ($75.17 / barrel in July 2021). The WTI and Brent crude oil benchmarks are undergoing very similar patterns this month. Additionally in July, the Brent-WTI spread increased to $10.31, the highest spread since May 2019.

In addition, we saw the Henry Hub Natural Gas spot price decrease 5% m/m to $7.28 / million Btu. This represents a 90% increase y/y.

Figure 1 charts the monthly average spot prices of WTI and Brent crude oil, plus the Henry Hub natural gas spot price from 2000 to present. “As European refiners move business away from Russia, they need new sources of crude oil to maintain refinery utilization rates and fuel production. This need for new sources is contributing to higher crude oil prices in Europe to attract crude oil exports to the region.” (eia.gov).

At Gerdau, we routinely monitor the price of oil issued by the Energy Information Administration since it has a direct impact on the cost of shipping and freight. These costs, in addition to the data we follow on oil and gas rotary rig counts, have been shown to impact long product sales.