Oil Dives Down On Weakening Demand in Europe
Oil slipped for a fourth day on Wednesday as concerns about weaker demand in Europe outweighed an industry report that showed U.S. crude inventories fell unexpectedly last week.
Several European countries have paused the use of AstraZeneca’s COVID-19 vaccine on worries over possible side effects. Germany is seeing rising coronavirus cases, Italy is imposing a nationwide Easter lockdown and France plans to impose tougher curbs.
Brent crude was down 38 cents, or 0.6 per cent, at $68.01 a barrel by 1410 GMT, having pared earlier losses. U.S. West Texas Intermediate crude dropped 35 cents, or 0.5 per cent, to $64.45.
The suspension will not do the bloc’s economic and fuel recovery any favours, stated Stephen Brennock of oil broker PVM. The hope now is that Europe can get its sluggish vaccine rollout back on track, he added.
Oil prices were also pressured by the latest reports from the International Energy Agency, which said a supercycle is unlikely and demand is not expected to return to pre-pandemic levels until 2023.
IEA’s report has triggered action among oil traders, commented Mr. Naeem Aslam of Avatrade. We have seen some selling, he revealed.
U.S. crude stocks rose last week as refineries hiked output, while gasoline stocks increased and distillate inventories rose, the Energy Information Administration said on Wednesday.
Crude inventories rose by 2.4 million barrels in the week to March 12, compared with analysts’ expectations for an increase of 3 million barrels.
Crude stocks at the Cushing, Oklahoma, delivery hub fell by 624,000 barrels, EIA said.
Refinery crude runs rose by 1.1 million barrels per day, EIA data showed. Refinery utilization rates rose by 7.1 percentage points.