| At 10:04 am Singapore time (0204 GMT), the ICE March Brent futures contract was up 20 cents/b (0.48%) from the previous close at $83.92/b, while the NYMEX February light sweet crude contract was 39 cents/b (0.48%) higher at $81.61/b.
Oil prices surged yesterday along with other risk assets following comments from US Fed Chairman, Jerome Powell. ICE Brent rallied by more than 3.5%, which saw it edge closer to US$84/bbl – a level last seen back in November. WTI is trading comfortably back above US$80/bbl. There was little in the way of a fundamental catalyst for the move in the oil market yesterday. Although clearly, sentiment has been broadly constructive since the start of the year due to a number of supply disruptions and growing concerns over OPEC spare capacity.
Overnight, the API released US inventory numbers. These showed crude oil inventories declining by 1.08MMbbls over the last reporting week, while Cushing crude inventories are reported to have fallen by 3.66MMbbls. The inventory change for crude is fairly neutral as the market was expecting a drawdown in the region of 1.6MMbls. The increases seen in product inventories was less supportive. Gasoline and distillate fuel oil inventories are reported to have increased by 10.86MMbbls and 3.04MMbbls respectively. (ING)
The gap between OPEC+ crude oil quotas and production remains in stark disparity as the group’s steady loosening of its pandemic cuts once again outpaced actual output gains in December, the latest S&P Global Platts survey found. Total OPEC+ quota compliance in December climbed to 116.5%, the survey found, the highest since the alliance instituted record output cuts in spring 2020, with the 19 members subject to production targets pumping some 620,000 b/d below their combined caps. (S&P Global Platts) |
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