Published: Fri, May 19, 2017
Life&Culture | By Rose Hansen

EIA Reports Crude Oil Inventories Decline 1.75 million Barrels, WTI Spikes Higher

EIA Reports Crude Oil Inventories Decline 1.75 million Barrels, WTI Spikes Higher

Crude was up 67 cents to $49.32 a barrel as of 10:48 a.m. EDT, though prices are still 8 percent below April's peak of $53.76.

Brent crude was down 15 USA cents at $51.50 per barrel by 8.51am GMT.

"The rally in crude oil prices that started after news that OPEC was ready to prolong its production cut agreement stalled overnight, as the market awaits evidence of rebalancing", ANZ bank said on Wednesday.The fall in prices came just days after Saudi Arabia and Russian Federation said on Monday that they agreed the need for a 1.8 million barrels per day (bpd) crude supply cut by the Organization of the Petroleum Exporting Countries (OPEC) and some other producers including Russian Federation to be extended for nine months, until the end of March 2018. Brent rose 81 cents to $52.45 a barrel.

But market watchers are growing more confident that OPEC, Russia and other big producers will extend cuts of nearly 1.8 million barrels per day (bpd) until the end of March 2018.

Saudi Arabia used 305,000 bpd of crude oil to generate power in March, up from 283,000 bpd in February, while Saudi demand for oil products remained nearly unchanged at 2.126 million bpd in March from 2.131 million the month before. US producers are not party to any agreements capping production. Saudi oil stocks peaked in October 2015 at a record 329.430 million barrels. The contract is on track for a 3.5-percent climb this week, a second week of gains.

Ford confirms large-scale job cuts for North America, Asia
As of mid-morning, Ford shares were off by more than 1 percent, to around $10.83, continuing a almost two-week slide. The cuts do not include the hourly workers on the assembly lines at American factories, who have union protection.

USA crude imports USOICI=ECI rose 577,000 bpd last week, while exports rose 400,000 bpd.

Analysts expected a 1.050 million barrels decline in distillates and an 731,000 barrels dip in gasoline supplies.

"The numbers beneath the surface were rather mixed with gasoline stocks falling only slightly on weaker demand and sharply higher imports suggesting sufficient availability of crude oil internationally despite OPEC cuts", said Carsten Fritsch, oil analyst at Commerzbank AG in Frankfurt, Germany.

There will still be some concerns surrounding gasoline inventories, but refinery utilisation rose 1.9% which will help boost short-term crude consumption.

Distillate stockpiles USOILD=ECI, which include diesel and heating oil, fell 1.9 million barrels, versus expectations for a 1.1 million-barrel drop, the EIA data showed. Supplies at Cushing, Oklahoma, fell by 540,000 barrels.

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