WTI Bounces Back Above $66 After Inventory Draws Across Entire Complex
Oil prices ended marginally lower after a choppy day of investors tempering expectations of an early return of oil exporter Iran to international crude markets (bullish) and US virus cases falling rapidly ahead of Memorial Day travels (bullish) battling with the overall weakness in economic data and slop in US equity markets and lower bond yields (bearish).
“Oil prices… remain at high levels as the high season for oil demand is approaching and as restrictions are lifted in much of Europe and the United States,” said Louise Dickson, oil markets analyst at Rystad Energy.
The swings in crude and product stocks in the last couple of weeks have been noisy thanks to the Colonial Pipeline shutdown. This week we should start to put that behind us, although product stocks may still be impacted.
Crude -439k (-1mm exp)
Gasoline -1.986mm (-1.1mm exp)
Distillates -5.137mm (-2mm exp)
Analysts expected inventory draws across the board this week, and they were right with Gasoline stocks down notably more than expected for the 7th straight week…
WTI hovered around $65.90 ahead of the API data and pushed back above $66 after the print.
“Crude prices are in wait-and-see mode until the fifth round of negotiations to revive the Iran nuclear deal are done,” said Edward Moya, senior market analyst at OANDA, noting “Energy traders need to know how much Iranian crude is going to hit the market.”
Iran may have some 69 million barrels of oil in floating storage waiting on tankers to travel to buyers when U.S. sanctions on its crude oil exports are removed, estimates from E.A. Gibson Shipbrokers cited by Bloomberg showed on Tuesday.
Tue, 05/25/2021 – 16:34
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