Europe and US may push global oil demand to the highest point since 2015. Estimations for demand growth in 2017 may increase by 100,000 barrels per day to 1.6 million a day, or a 1.7% increase. The supply glut has plagued the oil market and has delayed the re-balancing of oil prices. However, with OPEC supplies dwindling for the first time in 5 months after turmoil in Libya curtailed supply and other members produced less. Storages of refined fuels are decreasing to average levels in developed nations which may indicate that bullish bets on the horizon.
The impact of Hurricane Harvey will likely be short-term and will mostly affect the crude oil market. Government reserves and European imports provided a cushion, diminishing the effects of the natural disaster.
Inventories are edging closer to averages thanks to the 9-month output production cut. Spreads are tightening, an indication that crude prices may rise above the $50 level. Supporting this is OPEC’s recent commitment to supply cuts, announcing the body are prepared to extend the production cuts beyond March next year.
Global demand is outpacing expectations, this alone could push prices upwards. However, OPEC’s expectations of reaching $60 per barrel still seems unlikely.
Crude oil climbed 0.6 today, trading at $48.63. Meanwhile, Brent oil added 0.57% to its value, trading at $54.57. Find out by the spread between the two has widened.
We have crude oil inventories at 03:30 London time. It is expected that the change in the number of barrels held in inventory will be 4.1M down from 4.6M last week.