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Crude oil prices rose today following bullish news from the US Energy Information Administration, which reported a 6.4 million barrels drop in crude oil inventories and another decrease in crude oil inventories. fuel.
A week earlier, the EIA estimated a modest 1.3 million barrels drop in crude oil inventories, but a significant drop in gasoline pushed prices higher, signaling that strong demand has not abated. amid the latest wave of Covid-19 infections.
For the week through September 10, the EIA reported a further decline in gasoline inventories, to 1.9 million. This compares to a 7.2 million barrels draft a week earlier.
Gasoline production last week averaged 9.3 million bpd, up from 10.1 million bpd a week earlier.
Stocks of middle distillates fell 1.7 million barrels in the week to September 10, compared to 3.1 million barrels the week before.
Middle distillate production averaged 4.2 million bpd last week, up from 4.2 million bpd the week before.
A day before the EIA reported inventory movements, the American Petroleum Institute estimated that crude oil inventories had lost nearly 4 million barrels, pushing prices higher. Since the start of the year, according to API figures, US crude oil inventories have fallen by 70 million barrels.
Meanwhile, production is expected to increase as the stock of drilled but unfinished wells in the US shale patch declines. This, however, should not be a problem for prices since demand is also strengthening.
In its latest monthly oil report, the International Energy Agency predicts a 1.6 million bpd rebound in global oil demand next month as the Delta variant of the coronavirus loosens its grip on economies. It would then continue to grow for the rest of the year, the agency said, before starting to slow down next year.
“The market should move closer to equilibrium from October if OPEC + continues to unwind production cuts. Even so, it is not until early 2022 that the supply will be high enough to allow oil stocks to be replenished, ”the IEA said in its report.
That would provide stable price support over the next few months, and it’s support that will be needed as U.S. shale drillers step up with OPEC + to offset the depletion of existing wells.
By Irina Slav for Oil Octobers
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