MOSCOW (MRC) -- Crude oil futures were lower in mid-morning trade in Europe on Nov. 10, as the latest EIA Short Term Energy Outlook projects oil markets to be oversupplied in early 2022, reported S&P Global.
The EIA is set to release its latest US crude inventory data on Nov. 11 with the market watching closely whether it will confirm the inventory draw reported by the API on Nov. 9.
At 11:20 am London time (11:20 GMT), the January ICE Brent futures contract was down 7 cents/b at USD84.71/b from the previous close, while January NYMEX WTI futures were down 26 cents/b at USD82.32/b.
Crude prices stagnated midmorning in Europe after ticking up in midafternoon trade in Asia, following a report from the American Petroleum Institute that showed a larger than expected fall in US crude inventories. This caps a week-long rally, which saw Platts Dated Brent prices rise USD2.68/b in the past five days.
According to latest data from the American Petroleum Institute, or API, US crude inventories fell by 2.5 million barrels for the week ending Nov. 5 compared with a build of 3.6 million barrels reported by the API for the previous week. The forecasted consensus for the week ending Nov. 5 was an increase of 1.9 million barrels, exacerbating concerns about low crude inventory levels in the US over the past weeks.
Meanwhile, the EIA in its latest Short-Term Energy Outlook has also noted that growth in output from OPEC+ members, US shale and other non-OPEC countries will outpace slowing growth in global oil consumption in 2022. It forecasts Brent prices easing from current levels to an average of USD72/b for the year.
The focus for the rest of the week will shift to inventory data reported by the US Energy Information Administration as well as key inflation readings to be released later in the day by the US Labor department. The weekly inventory data from the EIA, is due to release on late Nov. 11 with market watchers awaiting to confirm on the drawdown in crude stocks.
As MRC informed before, US commercial crude stocks fell 3.48 million barrels to 413.96 million barrels in the week ended Sept. 17, to more than 8% below the five-year average, Energy Information Administration data showed. Stocks were last lower Oct. 5, 2018.
We remind that in late August, 2021, US crude stocks dropped sharply while petroleum products supplied by refiners hit an all-time record despite the rise in coronavirus cases nationwide, the Energy Information Administration said. Crude inventories fell by 7.2 million barrels in the week to Aug. 27 to 425.4 million barrels, compared with analysts' expectations in a Reuters poll for a 3.1 million-barrel drop. Product supplied by refineries, a measure of demand, rose to 22.8 million barrels per day in the most recent week. That's a one-week record, and signals strength in consumption for diesel, gasoline and other fuels by consumers and exporters.
We also remind that US crude oil production is expected to fall by 160,000 barrels per day (bpd) in 2021 to 11.12 million bpd, EIA said in a monthly report earlier this year, a smaller decline than its previous forecast for a drop of 210,000 bpd.
MRC