Oil prices dropped around noon on Thursday, after the United States removed some Iranian oil officials from its list of designated persons subject to sanctions.
The U.S. Department of the Treasury said on Thursday it is removing several Iranian officials from its list of designated persons, including three directors of the National Iranian Oil Company (NIOC).
Before the selling with the news of Iranian officials out of the sanctions list, oil prices were slightly higher after OPEC reiterated earlier today its forecast that global oil demand would jump in the second half of this year.
Global oil demand will rise by 6 million barrels per day (bpd) this year, led by strong consumption in China and the United States especially in the second half of 2021 with growing economies and border re-openings, OPEC said on Thursday, keeping its 2021 demand forecast unchanged from last month.
Before OPEC’s monthly report was published, prices were lower as the market was still digesting the large fuel inventory build in the United States for the week to June 4. In gasoline, the EIA estimated on Wednesday an inventory build of 7 million barrels for the week to June 4. This compared with a build of 1.5 million barrels for the previous week.
“A third weekly reduction in crude stocks on rising refinery demand inadvertently led to a surge in gasoline and diesel stocks during a week were the rolling average of gasoline demand, despite the Memorial Day weekend, ticked lower for the first time in a month,” Saxo Bank said on Thursday.
“Overall, not a game changer, with the subsequent market weakness probably more due to cautionary profit-taking after WTI failed to hold onto gains above $70,” the bank’s strategy team noted.
By Tsvetana Paraskova for Oilprice.com
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