Inventories of gasoline and distillates fell last week, as they should even in a coronavirus-impacted summer driving season, the U.S. Energy Information Administration reported today.
But crude inventories remained stubbornly high, an indication that the rise in demand for end products resulted in a drawn down of crude.
And without a drop in crude inventories oil prices aren’t heading much higher. Today U.S. benchmark West Texas Intermediate crude fell 1.15% to $37.93. International benchmark Brent crude slipped 0.66% to $40.69 a barrel.
Today, also, OPEC predicted that fuel demand will remain “under pressure” during the second half of the year because of the ongoing economic slowdown resulting from the coronavirus pandemic. Saudi Arabia, Russia and other members of OPEC+ will an online meeting on Thursday to review the impact of the current production cuts.
The U.S. EIA report also showed that U.S. crude production fell by 600,000 barrels a day to 10.5 million in the past week as Tropical Storm Cristobal forced some producers to shut output in the Gulf of Mexico.