Crude oil moved higher today after the Energy Information Administration reported a small inventory build of 100,000 barrels for the week to April 23.
At 493.1 million barrels, oil inventories are within the five-year seasonal average. Analysts had expected the EIA to report a lightly larger inventory increase of 375,000 barrels.
A week earlier, the EIA reported a modest inventory build in crude oil, at 600,000 barrels.
The authority also reported a 100,000-barrel inventory increase in gasoline inventories, with average production at 9.6 million bpd. This compared with an inventory build of a modest 100,000 barrels and average production of 9.4 million bpd in the previous week.
In middle distillates, the EIA estimated an inventory draw of 3.3 million barrels for the week to April 23, which compared with a decline of 1.1 million barrels a week earlier. Production of middle distillates averaged 4.6 million bpd last week, slightly higher than a week earlier.
Brent crude was trading at $67.02 a barrel at the time of writing, with West Texas Intermediate at $63.66 a barrel as OPEC injected some optimism into markets by confirming current plans to ease the production cuts as of May despite surging COVID cases in major oil importer India, which weighed on prices earlier in the week.
At the meeting of the Joint Ministerial Monitoring Committee of OPEC+, OPEC secretary-general Mohamed Barkindo said that “the oil market continues to reap the benefits of the DoC’s support for sustainable oil market stability and providing a platform the global economic recovery,” noting “the positive trajectory of the global economy, coupled with stimulus measures, progress on vaccinations and the summer travel season, as driving forces for the improving oil demand outlook in the second half the year.”
The optimistic outlook for the global economy has been a driving force behind the most recent improvement in oil prices despite continuing headwinds, including infection surges and slow vaccination rates in some parts of the world.
By Irina Slav for Oilprice.com
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