ENB Publishers Note: Too bad oil price’s don’t move like $GME (ok final reference for the day) huh? Crude oil prices stay flat even mid bullish draw according to the API. Traders wait for EIA crude numbers to confirm at 10:30 AM MST
Singapore — 0255 GMT: Crude oil futures edged higher during mid-morning trade in Asia Jan. 27, spurred by bullish data from the American Petroleum Institute and an improved pandemic outlook in the US, even as demand-side uncertainties owing to the progression of coronavirus elsewhere continued to weigh on sentiment.
At 10:55 am Singapore time (0255 GMT), the ICE Brent March contract was up 11 cents/b (0.20%) from the Jan. 26 settle to $56.02/b, while the March NYMEX light sweet crude contract was up 11 cents/b (0.21%) at $52.72/b.
The uptick comes as data from the American Petroleum Institute released Jan. 26 showed a massive 5.27 million-barrel draw in crude inventories in the week ended Jan. 22. Analysts, in contrast, had told S&P Global Platts that they had expected the draw in the same week to be much smaller at roughly 1.7 million barrels.
“Crude oil prices today are underpinned by a much larger-than-expected weekly draw in inventories, as well as a weakening US Dollar,” Margaret Yang, DailyFX strategist, told Platts Jan. 27.
Any increase in crude prices this morning, however, may have been tempered by the bearish elements in the API report, which also indicated that fundamentals in downstream product markets remained weak. US gasoline and distillate inventories jumped by 3.06 million barrels and 1.40 million barrels, respectively, in the week ended Jan. 22.
At 10:55 am, the NYMEX February RBOB contract was trading 0.44 cents/gal (0.28%) lower than the Jan. 26 settle at $1.5763/gal and NYMEX February ULSD contract was up by 0.04 cents/gal (0.03%) at $1.5988/gal.
Market participants will now be looking towards more comprehensive inventory data from the US Energy Information Administration to be released later in the day.
Meanwhile, progress towards alleviating the pandemic situation in the US may also have supported oil markets Jan. 27.
“Continuous drop in US daily COVID-19 counts has brightened the energy demand outlook as the likelihood of easing some of the lockdown measures is rising with the rollout of vaccines,” Yang told Platts. “US daily COVID-19 new cases have fallen to 133,913 on January 25th, marking the lowest reading since November 15th, according to CDC.”
Outside of the US, however, the pandemic situation remained grim. In Europe, countries are considering greater restrictions to curb the spread of the virus, whereas in Asia, demand-side concerns remain heightened following an outbreak in China.
Already, authorities in China have called upon citizens to not travel during the Lunar New Year Holiday, souring sentiment in the oil markets.
“While the general upward direction of travel in the market makes sense, it’s difficult for oil traders to make a definitive near-term shift to the next price level higher given the very uncertain near-term demand outlook,” surmised Stephen Innes, chief global markets strategist at Axi, in a Jan. 27 note.
2 Trackbacks / Pingbacks
Comments are closed.