The Energy Information Administration reported Wednesday that U.S. crude inventories rose by 4.9 million barrels for the week ended July 17. That compared with an average forecast by analysts polled by S&P Global Platts for a decline of 1.9 million barrels. The American Petroleum Institute on Tuesday reported a climb of 7.5 million barrels.
“On the bearish side, the 500-pound gorilla is the virus and any new shutdowns [of the economy] and overall less demand for crude oil,” Zahir said.
Oil prices, however, only tallied a modest decline for the session. Among supportive factors, Zahir said the market is in the middle of the Atlantic hurricane season with potential for output disruptions, the U.S. dollar has weakened, and positive results in trials for a COVID-19 vaccine could lead to a return in energy demand.
Crude 3 month chart
Crude 1 year chart below
Crude 5 year chart below
Crude 10 year chart below
Unleaded Gasoline Price Charts:
5 year........are we headed back to the highs?
Was listening to the Micheal Berry show this afternoon. And he was inteviewing someone who was in the oil industry, talking about the supply vs storage vs demand. And his take was that with the drop in active wells, along with the very low demand due to the virus, that crude prices would remained subdued for at least a couple of years. And wouldn't return to pre-covid levels until the covid problem was resolved. And even then, ?????
Very uncertain times revolving around COVID for sure!
"The U.S. dollar index against a basket of currencies .DXY was trading near its lowest since early March. A weaker dollar usually spurs buying of dollar-priced commodities because they become cheaper for holders of other currencies.
“Genuine price support comes from the weak dollar, which helps physical oil demand,” said Tamas Varga of oil brokerage PVM.
Rising U.S. oil inventories, however, weighed on prices.
U.S. crude and distillate inventories rose unexpectedly and fuel demand slipped in the most recent week, the U.S. Energy Information Administration said on Wednesday, as a sharp rise in coronavirus cases starts to hit U.S. consumption. [EIA/S]
U.S. coronavirus cases approached 4 million on Thursday, with more than 2,600 new cases every hour on average – the highest rate in the world, a Reuters tally showed.
Barclays said on Thursday oil prices could experience a correction in the near term if a recovery in fuel demand slowed further, especially in the United States. The bank expects Brent to average $41 in 2020 and WTI to average $37.
Adding to uncertainty in the market, U.S.-China relations deteriorated as Washington gave Beijing 72 hours to close its consulate in Houston after spying allegations.
The Chinese foreign ministry said the U.S. move had “severely harmed” relations and that China would be forced to respond."