MOSCOW (MRC) -- Crude oil futures ticked higher during mid-morning Asian trade Oct. 15, as positive data from the American Petroleum Institute and an increase in China's and India's refinery activities stoked bullish market sentiment despite tightening coronavirus restrictions, reported S&P Global.
At 10.45 am Singapore time (0245 GMT), ICE Brent December crude futures were up 6 cents/b (0.14%) from the Oct. 14 settle to USD43.38/b, while the NYMEX November light sweet crude contract was up 4 cents/b (0.10%) at $41.08/b. Both international crude markets had jumped 2.05% and 2.09% to settle at USD43.32/b and USD41.04/b, respectively, on Oct. 14.
The uptick in prices can be attributed to positive API data released late Oct. 14, which showed that US crude inventories had declined 5.4 million barrels to 495.4 million barrels in the week ended Oct. 9. This large draw in crude stocks far exceeded analysts' expectations of a 2.3 million barrel draw, according to an S&P Global Platts survey.
The API also reported a 1.513 million-barrel and a 3.930 million-barrel draw in US gasoline and distillate inventories, respectively, indicating that fundamentals in downstream oil markets were improving.
At 10.45 am Singapore time, the NYMEX November RBOB contract was trading 0.0011 cents/gal (0.09%) higher from the overnight settle at USD1.1982/gal and November ULSD contract was 0.17 cents/gal (0.14%) higher at USD1.1942/gal.
An added boost to market sentiment were indications that demand in Asia's oil-consuming behemoths China and India were on the mend.
Data collected by Platts on Oct. 14 showed that crude and bitumen blend imports by independent Chinese refineries were up 1.6% to 18.14 million mt, or 4.43 million b/d, in September, from a three-month low of 17.85 million mt in August. Earlier, data from the Chinese customs released Oct. 13 had also shown that the country's crude imports were up 2.1% on the month and 17.6% year on year to 48.5 million mt in September.
Meanwhile, Indian demand was also on the rise according to ANZ analysts in an Oct. 15 note: "India's refiners have boosted buying ahead of two main festivals, Navratri and Diwali, that typically increase demand for consumer goods and transportation fuel."
However, capping oil markers was the demand outlook, which remained bleak amid the coronavirus pandemic, as France declared a state of emergency late Oct. 14. and became the latest in a growing list of countries that are imposing tougher restrictions to stem the spread of the virus.
Edward Moya, senior market analyst at OANDA, said in an Oct. 15 note: "The COVID-19 second wave in Europe is getting out of control and that should force further action from lawmakers and central banks...It will be hard for risk appetite to return as Europe continues to go down the path of lockdowns."
As MRC informed earlier, global oil demand is forecast to peak by around 2040 because transport-fuel demand will decline steeply and economic growth will slow in the post-coronavirus world, the Institute of Energy Economics, Japan, said in its annual IEEJ Outlook 2021 on Oct. 15.
We remind that global oil demand may have already peaked, according to BP's latest long-term energy outlook, as the COVID-19 pandemic kicks the world economy onto a weaker growth trajectory and accelerates the shift to cleaner fuels.
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.
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