Headlines
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Higher U.S. inventories stop crude gains
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Stronger dollar puts lid on gold price
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Concerns over outlook for global economic recovery weight on base metals
Brent and Distillates
On Wednesday after a few day’s rally crude lost as dollar strengthened and U.S. crude inventories gained. This morning oil was steady as rising crude inventories in the U.S. signalled that a rebound in U.S. economic activity was failing to translate into higher demand.
U.S. crude stocks rose 2.3 mln.b last week, well above the consensus forecast for an increase of 200kbs. A rise in crude oil imports, up 559 kb/d to 8.43mln.b/d last week, explained some of the rise in crude stocks but weak demand from US refiners also contributed. Distillate stocks fell 1mln.b, matching the consensus forecast for a drop of 1.1mln.b but demand was down 9.1% compared with the same period a year ago. Petrol stocks fell 1.3mln.b, confounding the consensus forecast for an increase of 1.3mln.b but demand remained subdued, down 0.5% compared with the same period a year ago.
President B. Obama prepares new steps to nudge the United States toward energy independence, backing measures to boost production of biofuels and bury pollution from coal.
Citigroup reiterated its forecast for crude oil to trade around 85$/b over the next six to 12 months but warned that high levels of inventories and seasonal demand weakness in the second quarter could put pressure on OPEC to rein in excess supply.
Venezuela energy and oil minister Rafael Ramirez arrived in Beijing Tuesday for talks with government and company officials on joint-venture refinery projects and Chinese investment in Venezuela's heavy crude oil reserves.
