Breaking News
0
Ad-Free Version. Upgrade your Investing.com experience. Save up to 40% More details

Oil’s Higher, but is Hemmed in by U.S. Crude Struggles to Exceed $70

CommoditiesJun 11, 2021 03:55
Saved. See Saved Items.
This article has already been saved in your Saved Items
 
© Reuters.

By Barani Krishnan

Investing.com - The U.S. oil rally seems to be hitting a bit of a wall beyond $70 per barrel.

West Texas Intermediate, the benchmark for U.S. crude, reached another 2018 high on Thursday, rebounding from the previous session’s decline pressured by concerns over a weak summer start for gasoline demand. 

But despite an OPEC monthly prediction that global oil demand will accelerate in the second half of the year and burn through the pandemic-triggered supply glut accrued through last year, WTI’s daily gain and price peak were barely headline-worthy.

This suggested that crude bulls needed to find a new catalyst to keep the market’s current upward momentum alive, without descending into a near-term correction at least.

“We need to start showing some strong weekly draw numbers on gasoline soon, otherwise WTI is going to get weighed down, even if crude stocks keep falling,” said John Kilduff, founding partner at New York energy hedge fund Again Capital.

West Texas Intermediate crude, the benchmark for U.S. oil, settled up 33 cents, or 0.5%, at $70.29 per barrel. Its session high was $70.64. Since June 1, WTI has set new intraday highs going back to October 2018. But its climb has significantly slowed since getting past the $70 mark. 

Brent crude, which acts as the global benchmark for oil, settled up 30 cents at $72.52. Brent hit $72.90 earlier in the session, its highest since May 2019. 

WTI’s advance slowed after the U.S. Energy Information Administration said reported on Wednesday that gasoline inventories rose by 7.05 million barrels during the week ended June 4. Analysts tracked by Investing.com had forecast a build of just 1.2 million barrels.

Stockpiles of distillates, which include diesel and heating oil, rose by 4.4 million barrels against expectations for a 1.8 million barrel rise.

Crude stockpiles fell sharply too, by 5.2 million barrels versus forecasts for a 3.5 million-barrel decline. But that was only because of the ramp up in fuel production due to a spike in refining activity.

Analysts have projected one of the biggest ever summer demand periods for fuel in the U.S. as the economy reopens fully from a year of lockdowns and safety measures imposed after the March 2020 outbreak of the coronavirus pandemic.

But U.S. fuel take-up has so far been tepid, suggesting that more time was probably needed for demand to accelerate.

Oil’s Higher, but is Hemmed in by U.S. Crude Struggles to Exceed $70
 

Related Articles

Add a Comment

Comment Guidelines

We encourage you to use comments to engage with users, share your perspective and ask questions of authors and each other. However, in order to maintain the high level of discourse we’ve all come to value and expect, please keep the following criteria in mind: 

  • Enrich the conversation
  • Stay focused and on track. Only post material that’s relevant to the topic being discussed.
  • Be respectful. Even negative opinions can be framed positively and diplomatically.
  •  Use standard writing style. Include punctuation and upper and lower cases.
  • NOTE: Spam and/or promotional messages and links within a comment will be removed
  • Avoid profanity, slander or personal attacks directed at an author or another user.
  • Don’t Monopolize the Conversation. We appreciate passion and conviction, but we also believe strongly in giving everyone a chance to air their thoughts. Therefore, in addition to civil interaction, we expect commenters to offer their opinions succinctly and thoughtfully, but not so repeatedly that others are annoyed or offended. If we receive complaints about individuals who take over a thread or forum, we reserve the right to ban them from the site, without recourse.
  • Only English comments will be allowed.

Perpetrators of spam or abuse will be deleted from the site and prohibited from future registration at Investing.com’s discretion.

Write your thoughts here
 
Are you sure you want to delete this chart?
 
Post
Post also to:
 
Replace the attached chart with a new chart ?
1000
Your ability to comment is currently suspended due to negative user reports. Your status will be reviewed by our moderators.
Please wait a minute before you try to comment again.
Thanks for your comment. Please note that all comments are pending until approved by our moderators. It may therefore take some time before it appears on our website.
 
Are you sure you want to delete this chart?
 
Post
 
Replace the attached chart with a new chart ?
1000
Your ability to comment is currently suspended due to negative user reports. Your status will be reviewed by our moderators.
Please wait a minute before you try to comment again.
Add Chart to Comment
Confirm Block

Are you sure you want to block %USER_NAME%?

By doing so, you and %USER_NAME% will not be able to see any of each other's Investing.com's posts.

%USER_NAME% was successfully added to your Block List

Since you’ve just unblocked this person, you must wait 48 hours before renewing the block.

Report this comment

I feel that this comment is:

Comment flagged

Thank You!

Your report has been sent to our moderators for review
Disclaimer: Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. All CFDs (stocks, indexes, futures) and Forex prices are not provided by exchanges but rather by market makers, and so prices may not be accurate and may differ from the actual market price, meaning prices are indicative and not appropriate for trading purposes. Therefore Fusion Media doesn`t bear any responsibility for any trading losses you might incur as a result of using this data.

Fusion Media or anyone involved with Fusion Media will not accept any liability for loss or damage as a result of reliance on the information including data, quotes, charts and buy/sell signals contained within this website. Please be fully informed regarding the risks and costs associated with trading the financial markets, it is one of the riskiest investment forms possible.
Continue with Google
or
Sign up with Email