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Oil steadies amid weak summer kickoff for U.S. fuel demand

CommoditiesJun 09, 2021 04:21PM ET
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© Reuters. FILE PHOTO: Oil and gas tanks are seen at an oil warehouse at a port in Zhuhai, China October 22, 2018. REUTERS/Aly Song/File Photo

By Laura Sanicola

NEW YORK (Reuters) -Oil prices were steady on Wednesday after U.S. inventory data showed a surge in gasoline inventories due to weak fuel demand following U.S. Memorial Day weekend, traditionally the beginning of the peak summer driving season.

Brent crude futures remained unchanged to settle at $72.22 a barrel, having earlier touched $72.83, their highest since May 20, 2019.

U.S. West Texas Intermediate (WTI) crude closed 9 cents, or 0.1%, lower at $69.96 a barrel, after reaching $70.62, its highest since Oct. 17, 2018.

Despite a 5 million-barrel draw in crude oil last week, stocks of gasoline and other fuels rose sharply due to weak demand, according to Energy Information Administration data for the week that included the long Memorial Day holiday weekend. Product supplied fell to 17.7 million barrels per day, versus 19.1 million the week before.

"This could be canary in a coal mine at peak economic activity having occurred, but it's early days to conclude that," said John Kilduff, partner at Again Capital LLC in New York.

Other analysts noted, however, that the poor weather up and down the U.S. East Coast may have reduced consumption, following a period of gasoline hoarding that artificially boosted demand during the Colonial Pipeline outage last month from a ransomware attack.

On Tuesday, the EIA forecast U.S. fuel consumption would grow by 1.48 million bpd this year, up from a previous forecast of 1.39 million bpd.

Oil rallied earlier in the session on signs of strong fuel demand in western economies, while the prospect of Iranian supplies returning faded after the U.S. Secretary of State said sanctions against Tehran were unlikely to be lifted.

Investors had assumed that sanctions against Iranian exports would be lifted and oil supply would increase this year as Iran's talks with western powers on a nuclear deal progressed.

However, U.S. Secretary of State Antony Blinken said on Tuesday that even if Iran and the United States returned to compliance with a nuclear deal, hundreds of U.S. sanctions on Tehran would remain in place.

Oil steadies amid weak summer kickoff for U.S. fuel demand
 

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Comments (7)
Javier Escamilla
Javier Escamilla Jun 09, 2021 8:33AM ET
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Been telling you, stonks only go up xd
TL Chan
TL Chan Jun 09, 2021 12:06AM ET
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bull trap,
Chet Rowles
Chet Rowles Jun 09, 2021 12:06AM ET
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LOL
Chet Rowles
Chet Rowles Jun 09, 2021 12:06AM ET
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hahahah, you wish
TL Chan
TL Chan Jun 09, 2021 12:05AM ET
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US shale.oil enough for your next 10 generation ! Plus rotation to alternative energy ! The oil prices rise is fake , it is bull trap
Moises Verduzco
Moises Verduzco Jun 09, 2021 12:04AM ET
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Fraud
TL Chan
TL Chan Jun 09, 2021 12:03AM ET
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bear trap. Iran oil is coming soon !
perplexed76 .
perplexed76 . Jun 08, 2021 11:23PM ET
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oil prises will be in goods prices... we need more stimulus!
Ferdinando Riboni
Ferdinando Riboni Jun 08, 2021 11:10PM ET
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thank you Biden for our 5 per Gallon in California
perplexed76 .
perplexed76 . Jun 08, 2021 11:10PM ET
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what can he do? Stop vaccination? Take it easy, oil gamblers will be punished soon like their crypto twin brothers
Meru Pet
Meru Pet Jun 08, 2021 11:10PM ET
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give quadrillions of stimulus, so you heat yourself with the bills
vince smith
vince smith Jun 08, 2021 11:10PM ET
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first not stop the pipeline coming from Canada, allowing drilling in Alaska. Not let America become dependent on OPEC. thats a quick few
 
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