Oil prices came under pressure yesterday, with the price of Brent crude on the London Stock Exchange falling by almost 2.1%, ING commodities experts Ewa Manthey and Warren Patterson noted.
Brent falls as reports of peace talks between the United States and Russia calm supply risks
“Some downward pressure derives from reports that the US and Russia are working on a new peace plan for Ukraine. However, with suggestions that the plan is favorable to Russia, Ukraine may be less likely to support it. Signs that the US is still trying to work towards an agreement mitigate some concerns about further sanctions against Russia and also how strong the current restrictions will be imposed.”
“The Energy Information Administration (EIA) released its weekly US inventory data yesterday, reporting that US commercial crude oil inventories fell by 3.43 million barrels during the week. This decline was driven by strong crude oil exports, which grew by 1.34 million barrels per day on a weekly basis. Refineries also increased run rates, leading to increased crude oil inputs. Stronger run rates should not be too surprising, given that refining margins are strong, while refineries are also coming out of their maintenance season.”
“Changes in refined products inventories were more bearish. Gasoline inventories increased by 2.33 million barrels, while distillate inventories rose by 171,000 barrels. Implied gasoline demand was also weaker, falling by 500,000 barrels per day year-over-year. The more bearish gasoline numbers saw the stock’s Reworked Oxygen Blending Blend (RBOB) come under some pressure yesterday.”
