|Brent remains in mid-70s despite highly bearish US oil inventory report|
|By A/S Global Risk Management.
|Michael Poulson, Global Risk Management. Image credit: Global Risk Management|
|Updated on 07 Jun 2018 08:00 GMT
|The publishing of the report only caused a minor blip in oil prices as markets seem to ignore the data. The report showed that crude oil stocks grew by 2 mio. barrels, distillates by 2.1 mio. barrels, while gasoline increased by a whopping 4.6 mio. barrels. Furthermore, data points to increasing U.S. exports of crude in April. 1.76 mio. barrels per day was exported, up from 1.67 mio. barrels per day in March. U.S. production rose by 31,000 barrels per day to 10.8 mio. barrels per day.
Venezela's difficulties to supply crude seems to be increasing day by day. Allegedly, there is a supply backlog of more than 24 mio. barrels as tankers are waiting off the main oil port and the country's oil company could be forced to declare force majeure situation. April's export figure was the highest since at least 1920.
Supporting oil prices are comments from OPEC member Iraq, stating that a production increase is not on the table at the coming meeting later this month as the market is "stable and prices good".
Turning to economic data, the European Central Bank yesterday mentioned a potential winding down of its stimulus program this year after inflation data improved. The Euro Area has been struggling with threats of deflation for a long time and therefore implemented a bond purchase program to spur growth, which now seems to have succeeded. The potential political turmoil in Italy seems to have vanished for now as a new government was sworn in last week.
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