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Oil futures fell again on Thursday as bullish gains in U.S. crude stockpiles were offset by an unexpected build in gasoline and diesel stockpiles, adding to concerns about fuel demand as the summer driving season begins.
U.S. Energy Information Administration report In the week ended May 24, U.S. crude oil inventories fell by 4.2 million barrels, exceeding expectations, but gasoline inventories increased by 2 million barrels, and gasoline demand fell to 9.1 million barrels per day from 9.3 million barrels per day the previous week.
Capital’s John Kilduff again told Reuters he expected gasoline to be lower before the holiday weekend “but that’s too big to deplete product inventories when refineries start pumping,” adding Adding that he expects gasoline demand to be close to 9.5 million barrels per year.
“Weakness in the gasoline market continues to weigh on other parts of the oil complex,” StoneX analysts said. “The demand outlook for the summer remains uncertain due to rising interest rates and a potential economic slowdown.”
Near month June Nymex RBOB gasoline futures (XB1:COM) closed -2.4% to a three-month low of $2.4046 per gallon, while ultra-low sulfur diesel futures hit their lowest in nearly a year.
Nymex front-month crude oil (CL1:COM) for July delivery has ended -1.7% to US$77.91/barrel. Front-month July Brent crude oil (CO1:COM) closed down for the sixth time in the past eight trading days. -2.1% to US$81.86/barrel.
ETF: (New York Stock Exchange: Use), (BNO), (UCO), (SCO), (USL), (DBO), (DRIP), (GUSH), (NRGU), (USOI), (NYSE: UGA)
Volatility is likely to continue into the weekend as markets focus on Sunday’s OPEC+ meeting, where the group will decide whether to extend production cuts beyond the second quarter.
OPEC+ is working on a complex deal to be agreed upon at the meeting that would allow the group to extend some of its deep production cuts until 2025, Reuters reported on Thursday.
The organization currently cuts a total of 5.8 million barrels per day of production, including 3.66 million barrels per day from OPEC+ members, which is valid until the end of this year, and 2.2 million barrels per day of voluntary production cuts by some members, which will expire in 2017. .
The report said the new agreement could include extending part or all of the 3.66 million barrels per day production cut to 2025, and extending part or all of the 2.2 million barrels per day voluntary production cut to the third or fourth quarter of 2024.
