MOSCOW (MRC) -- Crude oil futures were lower in mid-morning trade in Asia on Aug.19 after American Petroleum Institute data released late Aug.18 showed a surprisingly large build in gasoline inventories even as US commercial crude supplies fell for a consecutive fourth week, said S&P Global.
At 10:32 am Singapore time (0232 GMT), the ICE Brent October crude futures were down 27 cents/b (0.59%) from the Aug.18 settle at $45.19/b, while NYMEX September light sweet crude contract was down by 18 cents/b (0.42%) at USD42.71/b.
"API reported a big build in gasoline inventories, which has somewhat taken the edge off the bullish market sentiment," Stephen Innes, chief global markets strategist at AxiCorp, said in a note Aug.19. "Summertime builds are never received well, but particularly towards the end of this summer as there is some concern the virus could rage again during colder winter months in the northern hemisphere and further crimp gasoline demand," he added.
Meanwhile, US commercial crude inventories were reported to have declined by 4.26 million barrels for the week ending Aug.14, slightly higher than the 3.8 million barrels drawdown estimated on Aug.17.
Notably, it will be the fourth consecutive week of drawdown for US commercial crude inventories if the official weekly US inventory report due for release by the Energy Information Administration later in the day confirms the API industry report on Aug.18.
Meanwhile, the continued spread of COVID-19 worldwide remains the key drag on the short-term demand outlook. Global COVID-19 infections exceeded 22 million case counts while total deaths reached 779,443, latest data from John Hopkins University showed.
A resurgence of infections in major European economies also reignited concerns that global economic recovery will continue to slow as countries tightened pandemic containment restrictions. The number of new cases in Germany reached four-month highs on Aug.17, while Spain registers 16,000 new infections in three days, according to media reports.
Elsewhere, members of the OPEC+ alliance will be meeting to discuss about compliance and compensation cuts through September for members who failed to abide by their output quotas from May to July in the Joint Ministerial Monitoring Committee meeting.
Earlier this year, BP said the deadly coronavirus outbreak could cut global oil demand growth by 40 per cent in 2020, putting pressure on Opec producers and Russia to curb supplies to keep prices in check.
And in September 2019, six world's major petrochemical companies in Flanders, Belgium, North Rhine-Westphalia, Germany, and the Netherlands (Trilateral Region) announced the creation of a consortium to jointly investigate how naphtha or gas steam crackers could be operated using renewable electricity instead of fossil fuels. The Cracker of the Future consortium, which includes BASF, Borealis, BP, LyondellBasell, SABIC and Total, aims to produce base chemicals while also significantly reducing carbon emissions. The companies agreed to invest in R&D and knowledge sharing as they assess the possibility of transitioning their base chemical production to renewable electricity.
Ethylene and propylene are feedstocks for producing polyethylene (PE) and polypropylene (PP).
According to MRC's DataScope report, PE imports to Russia dropped in January-June 2020 by 7% year on year to 328,000 tonnes. High density polyethylene (HDPE) accounted for the main decrease in imports. At the same time, PP imports into Russia rose in the first six months of 2020 by 21% year on year to 105,300 tonnes. Propylene homopolymer (homopolymer PP) accounted for the main increase in imports.