At 11:38 am Singapore time (0338 GMT), the ICE October Brent futures contract was more extra. It lead 11 cents/b (0.15%) from the previous close at $71.55/b. While the NYMEX September light sweet crude contract was further after 11 cents/b (0.16%) at $69.36/b.
The uptick in prices occurred amid a dollar reduction following data from the US Labor Department revealed that the increase in the core US Consumer Price Index in July was lesser than market expectations and the growth detected in June. Core CPI increased 0.3% in July. It was just modest of market expectations of 0.4% and significantly under the 0.9% jump witnessed in June.
The US dollar index traded toward 92.90 at 11:28 am Singapore time, beneath 0.167% from Aug. 10. A more inferior dollar makes dollar-denominated assets, like oil futures, appealing to buyers holding foreign currency and increasing their demand.
Meantime, the weekly EIA report published late Aug. 11 confirmed total US crude commercial stocks are decreasing 450,000 barrels in the week closed Aug. 6 to 438.78 million barrels.
Downstream products data was diverse. From a 1.4 million barrel drop in US gasoline inventories to 227.47 million barrels, any bullishness became balanced by a 1.77 million-barrel increase in US distillate inventories of 140.51 million barrels.
Gasoline inventories declined
The decline in gasoline inventories was not significantly indicative of increased demand-side fundamentals. The data implies have instead worsened among growth in coronavirus infections in the country.
Implied gasoline demand dropped about 3.5% on the week to 9.43 million b/d. At the same time, the total suggested demand for all products slipped almost 8% to 19.51 million b/d — a four-week low.
Analysts stated the market also has come under pressure following media reports surfaced that the Biden administration has asked for OPEC+ to boost oil supply over the coalition’s current plan to extend back 400,000 b/d of oil periodically from August onward.
OPEC+ has taken similar calls from other countries, including India. All of them have told the producer group’s production cuts have pointed to higher oil prices, which could endanger the global economic improvement.
US National Security Advisor Jake Sullivan repeated this view on Aug. 11, replying that crude oil futures are now trading at higher rates than pre-epidemic levels.