Sat, 08 May 2021

OPEC prices slide, but remain strong on increased demand

Robert Besser
18 Apr 2021, 06:07 GMT+10

NEW YORK, New York: Oil prices fell this week, but held their month-long highs after futures saw a jump amid raised projections for global oil demand by the energy authority IEA, among others, as the largest economies continue recovering from the COVID-19 crisis.

Brent crude futures fell by 21 cents, or 0.3 percent, to reach $66.37 per barrel, after clocking a gain of 4.6 percent on Wednesday and posting its highest finish since March 17.

U.S. WTI crude futures dipped 25 cents, or 0.4 percent, to reach $62.9 per barrel, after registering a 4.9-percent high during the earlier session.

A 5.9-million barrel drop was recorded in U.S. crude inventories for the week ending Apr 9, the EIA noted on April 14, over twice the analysts' forecasted drop of 2.9 million barrels. Additionally, U.S. east coast gasoline inventories plunged to an all-time low.

"We see robust stock draws, even after factoring in bearish risks as refinery runs are set to rise sharply in the coming months," according to Citi Research.

The EIA reported decreasing gasoline supplies during the previous week, indicating fuel consumption in the United States rose to 8.9 million barrels per day, the steepest increase since August.

The month-to-month report from the IEA stated that oil supply and demand are on target to continue to rebalance during the latter half of 2021, after last year's demand vanished in the wake of the coronavirus crisis.

Meanwhile, OPEC projected a 70 ,000 thousand barrels per day spike in demand, as compared to March's projection, while worldwide demand is expected to record an increase of 5.95 million barrels per day this year.

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