Brent futures were up 14 cents/b, or 0.3%, at $45.10/b by 5:50 am GMT, while WTI futures were up 11 cents/b, or 0.3%, at $42.35/b.
Prices have been bolstered this week by EIA data released on August 12 reporting a 4.51 million-barrel draw in US commercial crude inventories, exceeding market expectations for the third consecutive week. Total gasoline and distillate stocks also fell in the week, as refiners ramped up production and demand for oil products improved.
US Department of Labor data released on August 13 showed weekly initial unemployment claims fell to 963,000 in the week ended Aug. 8 from 1.19 million the week before, below 1 million for the first time since mid-March, and beating market expectations of 1.1 million. However, negotiations between the US administration and Congress for another coronavirus fiscal stimulus package remained at a stalemate, with the Senate joining the House for recess for the rest of August, according to media reports.
The International Energy Agency also lowered its 2020 world oil demand estimate by 140,000 b/d from the month before to 91.95 million b/d in a report published August 13, the first downgrade in the IEA’s oil demand forecast in several months and coming a day after OPEC revised down its 2020 forecast by 100,000 b/d to 90.63 million b/d. The downbeat view on demand mirrors participants’ view on the market. The easing of restrictions in many parts of the US and Europe has slowed amid a pick-up in infections.
According to an ANZ research report on August 14, traffic levels have plateaued and are sitting at 50% below 2019 levels. Air traffic is also weak, with commercial flights in July 50% below 2019 levels. With supply also rising over the coming months, Brent crude is not expected to remain above $45/b in Q3.
Meanwhile, China’s economic recovery continued in July, with industry growing at the same pace as June due to overseas demand, according to data released Friday. Nevertheless, weak domestic retail sales continued to undercut the rebound, however. Still, Bloomberg reported an expected increase in Chinese buying later in the year, which may lend some support to prices.
On another note, OPEC+ producer bloc has delayed its Joint Ministerial Monitoring Committee by a day to August 19 due to Russian Energy Minister Alexander Novak’s schedule, according to delegates. Novak said the market is stabilizing and there’s no need to ease OPEC+ output cuts ahead of time, Tass news agency reported.
MARKETS NEWS:
- Record China Crude Stockpiles Edge Higher to 71% Capacity: Ursa
- China’s July Apparent Oil Demand Rises 19.5% Y/y
- OPEC+ Delays Monitoring Meeting by a Day to Aug. 19: Delegates
- Canadian Crude Price Strength Returns Amid Maintenance Work
- Venezuela’s Crude-for-Diesel Swaps Mean Less Going to China
- Singapore Marine Fuel Sales Rise 9% M/m in July From June
- Gasoil Stockpiles Fall in Europe’s ARA Region: Insights Global
OTHER NEWS:
- S. Says Iran Forces Boarded Tanker in International Waters
- Benchmark VLCC Rates Steady; Clean Tankers From Mideast Jump
- Israel and UAE Agree to Establish Ties; Annexation Is Paused
- China’s Power Output Hits Record Amid Summer Peak Demands
PHYSICAL CRUDE NEWS:
- ASIA: Qatar Offers Al-Shaheen; IEA Cuts Demand Forecasts
- LATAM: Venezuelan Oil Exports Up; El Palito Refinery Down
- US/CANADA: U.S. Crude Output to Drop 900K B/D in 2020
- NSEA: Litasco, Equinor Buy Ekofisk; U.S. Flows to Rise
- MED: Urals Offered at 4-Month Low; U.S. Flows to Rise
- WAF: Vitol Withdraws Brass, Forcados Offers; Tupras Tender
OIL PRODUCT NEWS:
- S.: Refiners in West Looking Toward Biofuels
- EUROPE: ARA Fuel Oil Stocks Drop; Heide to Halt
- ASIA: Singapore Stockpiles Rise; Shell Philippines
ECONOMIC EVENTS: (Times are London)
- 6:00pm: Baker Hughes weekly rig count report at 1pm
- 6:30pm: ICE Commitments of Traders report
- 8:30pm: CFTC Commitments of Traders report
- EARNINGS: Rosneft
ANALYST COLUMNS:
- U.S. Refining Margins Below $10/Bbl Signal Supply Builds: Mizuho
- Calif. Refinery Shifts Open Doors for Padd 3 Shippers: Stratas
OTHER FINANCIAL MARKETS:
- Asian Stocks Drift; Treasuries Steady After Losses: Markets Wrap
Singapore 380 INDIC
Sep20 258.75 / 260.75
Oct20 258.25 / 260.25
Nov20 258.25 / 260.25
Dec20 259.50 / 261.50
Jan21 261.25 / 263.25
Feb21 263.25 / 265.25
Q4-20 258.75 / 260.75
Q1-21 263.25 / 265.25
Q2-21 267.75 / 269.75
Q3-21 271.00 / 274.00
CAL21 269.00 / 275.00
Rotterdam 3.5% INDIC
Sep20 248.00 / 250.00
Oct20 245.75 / 247.75
Nov20 244.75 / 246.75
Dec20 244.75 / 246.75
Jan21 246.50 / 248.50
Feb21 248.00 / 250.00
Q4-20 245.25 / 247.25
Q1-21 248.00 / 250.00
Q2-21 252.00 / 254.00
Q3-21 254.50 / 257.50
CAL21 252.50 / 258.50
Singapore VLSFO 0.5% INDIC
Sep20 330.50 / 335.50
Oct20 332.00 / 337.00
Nov20 334.00 / 339.00
Dec20 336.00 / 341.00
Jan21 339.00 / 344.00
Feb21 341.50 / 346.50
Q4-20 334.00 / 339.00
Q1-21 341.50 / 346.50
Q2-21 348.50 / 354.50
Q3-21 355.00 / 361.00
CAL21 351.25 / 357.25
Rott VLSFO 0.5% INDIC
Sep20 311.25 / 316.25
Oct20 314.75 / 319.75
Nov20 317.50 / 322.50
Dec20 319.75 / 324.75
Jan21 323.50 / 328.50
Feb21 326.50 / 331.50
Q4-20 317.50 / 322.50
Q1-21 326.50 / 331.50
Q2-21 334.00 / 340.00
Q3-21 340.75 / 346.75
CAL21 336.75 / 342.75
Sing 10ppm GO INDIC
Sep20 50.21 / 50.35
Oct20 50.60 / 50.80
Nov20 50.99 / 51.19
Dec20 51.41 / 51.61
Jan21 51.89 / 52.09
Feb21 52.36 / 52.56
Q4-20 51.00 / 51.20
Q1-21 52.36 / 52.56
Q2-21 53.68 / 53.88
Q3-21 54.87 / 55.07
CAL21 54.02 / 54.42
ICE Gasoil 10ppm INDIC
Sep20 380.81 / 382.81
Oct20 385.17 / 387.17
Nov20 388.63 / 390.63
Dec20 392.25 / 394.25
Jan21 396.07 / 398.07
Feb21 399.85 / 401.85
Q4-20 388.70 / 390.70
Q1-21 399.59 / 401.59
Q2-21 407.71 / 409.71
Q3-21 417.67 / 419.67
CAL21 412.04 / 414.04
Rott Hi5 Sing Hi5
Sep20 65 73
Oct20 70 75
Nov20 74 77
Dec20 76 78
Jan21 78 79
Feb21 80 80
Q4-20 74 77
Q1-21 80 80
Q2-21 84 83
Q3-21 88 85
CAL21 84 82