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Thu 17 May 2018, 07:23 GMT

Oil at three-and-a-half-year high on inventory deviations, geopolitical uncertainty


By A/S Global Risk Management.


Michael Poulson, Global Risk Management.
Image credit: Global Risk Management
The weekly oil inventory report from the Energy Information Administration (EIA) yesterday showed a larger-than-expected draw in crude and gasoline inventories and completely in the opposite direction of the weekly oil stocks data from the American Petroleum Institute (API), and this supported oil prices. Brent increased by $1 following the EIA release. Markets are increasingly focusing on potential shortage of supplies as global inventories are shrinking.

EIA crude oil inventories: -1.1404M barrels (-0.763M expected) API crude oil inventories: 4.854M barrels (-1.850M previous)

In its monthly oil market report, published yesterday, the International Energy Agency (IEA) lowered its global oil demand growth forecast for this year by 0.1 mio. barrels per day (bpd) to 99.2 mio. bpd. Supplies are currently 98 mio. bpd, but according to the IEA: "non-OPEC growth... will grow by 1.87 mio. bpd in 2018". The reason for the revision of demand growth could be the increasing oil prices, which could dampen consumption. According to the agency, global inventories have dropped below the 5-year average - which was a goal for the current oil production cut agreement - for the first time since 2014.

Turning to economic data, today's main potential market mover is the U.S. Philadelphia Fed Manufacturing Index along with a couple of Fed member speeches. Other than that, no major releases.

BP  

HMM and HD Hyundai Heavy Industries (HD HHI) contract signing. HMM orders eight LNG dual-fuel container ships in newbuild push  

South Korean carrier commissions 13,000-TEU vessels from HD Hyundai, with deliveries due to begin in 2029.

Keel-laying ceremony of vessel with builder's hull no. S1125. CIMC SOE advances construction on three LNG bunker vessels  

Chinese shipbuilder progresses three bunker vessel projects in the same week.

Verde Marine Energy (VME) logo. Verde Marine Energy adds two staff as it expands bunkering operations in ARA region  

Dutch bunker supplier hires former Melroh Trading employees and launches RMG 380 3.5% HSFO barge service following Sunoco Marine tie-up.

Fund for Energy Efficiency Technologies (FEET) signing ceremony. Fund for Energy Efficiency Technologies finances first wind-assisted propulsion projects with Eastern Pacific Shipping  

GCMD and AIM Horizon Investments link verified fuel savings to financing for two EPS vessels fitted with wind-assisted propulsion.

Launching ceremony of Yacht Prime and Yacht Star. Pinnacle Marine launches two B100-compatible utility boats for Excelessel Offshore  

Singapore shipbuilder nears completion of six-vessel B100 series.

Maersk Torino vessel. BSM takes over methanol-fuelled Maersk Torino, building alternative fuel experience  

Ship manager adds methanol-fuelled container vessel to its fleet, citing growing expertise in alternative fuel operations.

Albert Park vessel. Bureau Veritas marks naming of Union Maritime's wind-assisted Aframax tanker  

Albert Park, fitted with three WindWings sails, is Chinese yard's first wind-assisted Aframax product tanker.

Maersk Halifax ship-to-ship (STS) ethanol bunkering operation. Singapore completes world's largest ethanol bunkering operation  

Maersk, Golden Island and PSA perform ethanol bunkering in Singapore, drawing on methanol handling experience and safety protocols.

WinGD Global Service personnel. WinGD signs five-year service deal for NYK LNG carrier fleet  

Swiss engine designer WinGD will support ten dual-fuel engines across five Japanese-operated LNG carriers.

Steel-cutting ceremony for vessel with builder's hull no. N1036. Steel cut for third methanol-ready chemical tanker in ROC-Essberger series  

Chemical tanker series is designed with provisions for methanol fuel and wind-assisted propulsion systems.


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