WTI Extends Gains After Sizable Crude Inventory Draw, Shrugs Off Unexpoected Product Builds
Oil prices are holding gains, with WTI around $69, after last night’s bigger than expected crude draw reported by API, helped by signs of demand rebounding in the US (PMI/ISM) offsetting China concerns.
Crude prices have extended gains this week on OPEC’s new outlook and because nuclear talks between Iran and world powers stalled.
“There will always be a good amount of supply to meet demand,” Saudi Energy Minister Prince Abdulaziz bin Salman said at a forum in St. Petersburg on Thursday.
“We’ll have to see demand” before producers increase supply, he said.
Additionally, Saudi Arabia increased oil prices for customers in its main market of Asia by more than expected after Brent crude surged above $70 a barrel and OPEC forecast that global demand would heavily outstrip supply over the rest of the year.
Crude -5.36mm (-3.3mm exp)
Gasoline +2.51mm (-1.1mm exp)
Distillates +1.585mm (-1.6mm exp)
Crude -5.079mm (-3.3mm exp)
Cushing +784k – biggest build since Feb
Gasoline +1.499mm (-1.1mm exp) – biggest build since April
Distillates +3.72mm (-1.6mm exp) – biggest build since March
Crude stocks fell notably last week but product inventories unexpectedly rose…
US Crude production continues to remain ‘disciplined’ (in fact, falling 200kb/d last week) despite the soaring prices and surging rig counts….
Oil is in “strong demand right now” amid the world’s “strong recovery,” Daniel Yergin, the oil historian and vice chairman at IHS Markit, said in a Bloomberg TV interview. U.S. oil production will start to go up “at a modest rate” in 2H, Yergin said. Shale producers are focused on returning capital to investors, and companies are “getting on board” about net zero carbon by 2050. He sees oil prices this year in $60-$75/bbl range, though it could touch $80.
WTI hovered around $69 ahead of the official data and extended gains after…
Finally, as we detailed earlier, the world’s largest petrostates rejected calls for a rapid shift away from oil and gas, warning that starving the industry of investment would harm the global economy.
If the world were to follow the IEA’s controversial road map, which said investment in new fields would have to stop immediately to achieve net-zero carbon emissions by 2050, “the price for oil will go to, what, $200? Gas prices will skyrocket,” said Russian Deputy Prime Minister Alexander Novak. His warnings were echoed by the energy ministers of Qatar and Saudi Arabia.
Thu, 06/03/2021 – 11:03
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