Get 40% Off
🤯 This Tech Portfolio is up 29% YTD! Join Now to Get April’s Top PicksGet The Picks – Just 99 USD

Oil rallies on U.S. crude stockpiles — only a day late

Published 03/31/2023, 03:22 AM
Updated 03/31/2023, 03:22 AM
© Reuters.

© Reuters.

By Barani Krishnan

Investing.com -- Put it down to one of the many market idiosyncrasies but crude prices rallied as much as 2% Thursday on bullish U.S. supply-demand numbers — only a date later than they should have.

New York-traded West Texas Intermediate, or WTI, crude settled at $74.34 per barrel, up $1.40, or 1.9%, responding to the weekly petroleum data released by the U.S. Energy Information Administration, or EIA, on Wednesday.

London-traded Brent crude settled at $79.27, up 99 cents, or 1.3%.

In the previous session, WTI slipped 0.3% and Brent 0.5% despite the EIA reporting the biggest weekly crude drawdown in four months. It also cited a sizable drop in gasoline stockpiles that indicated a pick-up in fuel demand ahead of the oncoming summer driving season.

“Regardless of your positioning and bias, it’s funny sometimes to see the market doing the exact opposite of what it should on a day, and this was the case with oil yesterday,” said John Kilduff, partner at New York energy hedge fund Again Capital.

Adding to Thursday's U.S.-inventory-driven rally were reports of more outages in Kurdish crude supply. Producers have shut in or reduced output at several oilfields in the semi-autonomous Kurdistan region of northern Iraq following a halt to the northern export pipeline, Reuters reported

U.S. crude stockpiles on their own fell by 7.489 million barrels during the week ended March 24, the EIA said in its Weekly Petroleum Status Report.

Historical data maintained by the EIA showed it to be the largest U.S. crude draw in a week since late November. The draw also marks a reversal from almost three straight months of crude builds since December that resulted in an additional supply of 60M barrels. 

Industry analysts tracked by Investing.com had forecast a build of 92,000 barrels instead for last week, versus the rise of 1.117M barrels seen during the previous week to March 17.

On the gasoline inventory front, the EIA reported a drawdown of 2.904M barrels against an expected drop of 1.617M barrels and the 6.4M-barrel decline in the previous week. Automotive fuel gasoline is the No. 1 U.S. fuel product.

With distillate stockpiles, there was a build of 281,000 barrels. Analysts had forecast a drop of 1.455M barrels versus the prior week’s deficit of 3.313M. Distillates, which are refined into heating oil, diesel for trucks, buses, trains and ships and fuel for jets, were originally the strongest demand component of the U.S. petroleum complex at the start of the year.

The summer driving season, which begins in earnest in late May and extends to late September at times, typically marks the heaviest demand period for motor fuels in the United States.

Latest comments

Risk Disclosure: Trading in financial instruments and/or cryptocurrencies involves high risks including the risk of losing some, or all, of your investment amount, and may not be suitable for all investors. Prices of cryptocurrencies are extremely volatile and may be affected by external factors such as financial, regulatory or political events. Trading on margin increases the financial risks.
Before deciding to trade in financial instrument or cryptocurrencies you should be fully informed of the risks and costs associated with trading the financial markets, carefully consider your investment objectives, level of experience, and risk appetite, and seek professional advice where needed.
Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. The data and prices on the website are not necessarily provided by any market or exchange, but may be provided by market makers, and so prices may not be accurate and may differ from the actual price at any given market, meaning prices are indicative and not appropriate for trading purposes. Fusion Media and any provider of the data contained in this website will not accept liability for any loss or damage as a result of your trading, or your reliance on the information contained within this website.
It is prohibited to use, store, reproduce, display, modify, transmit or distribute the data contained in this website without the explicit prior written permission of Fusion Media and/or the data provider. All intellectual property rights are reserved by the providers and/or the exchange providing the data contained in this website.
Fusion Media may be compensated by the advertisers that appear on the website, based on your interaction with the advertisements or advertisers.
© 2007-2024 - Fusion Media Limited. All Rights Reserved.