Tuesday, January 31, 2023
HomeBusinessOil Fails to Recover Despite Building up U.S. Gasoline Stocks

Oil Fails to Recover Despite Building up U.S. Gasoline Stocks

On Thursday, oil prices increased but failed to completely recover from the losses of the previous session when a build in U.S. gasoline inventories indicated a worsening outlook for fuel demand as cases of coronavirus soar.

At 0803 GMT, Brent crude LCOc1 futures were up 22 cents at $41.95 a barrel. Crude CLc1 futures from U.S. West Texas Intermediate (WTI) ticked up 17 cents to $40.20 a barrel. In their steepest daily drop in three weeks, both contracts shed more than 3 percent on Wednesday.

In the week to Oct. 16, the Energy Information Administration (EIA) said on Wednesday, USOILG = ECI gasoline stocks increased by 1.9 million barrels, compared to expectations of a 1.8 million-barrel drop. In the four weeks to Oct. 16, the EIA said the total product delivered, a proxy for demand, averaged 18.3 million barrels per day-down 13 percent from the same duration a year earlier.

In many U.S. states and in Europe, new daily COVID-19 infections reaching records, new lockdowns and China’s clamp-down on outbound travel to help curb the spread of the disease, all bode ill for fuel demand.

Deteriorating the outlook, expectations that U.S. policymakers will reach an agreement on an economic stimulus package with the White House dimmed late on Wednesday after President Donald Trump accused Democrats of holding a compromise agreement.

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