Oil Falling After US Gasoline Stocks Rose, Contrary to Expectations

Oil prices fell on Thursday, April 8th, after official data revealed that US gasoline stocks rose significantly, raising concerns about weak demand in the world’s largest consumer of crude at a time when supplies rose around the world.

Brent crude fell 51 cents, or 0.8%, to $ 62.65 a barrel. US crude fell 53 cents, or 0.9%, to $ 59.24 a barrel.

The US Energy Information Administration said that while crude oil inventories in the United States fell by more than analysts had expected, gasoline inventories jumped strongly, also against expectations.

Oil inventories decreased by 3.5 million barrels last week to nearly 502 million barrels, and gasoline inventories increased by 4 million barrels, against expectations of a decrease, to just under 230 million barrels, as refiners intensified production before the summer season when driving cars increased.

At the same time, dealers say supplies are rising around the world, while Russia’s production in the first few days of April was above average levels recorded in March.

And some sanctions on Iran may be lifted, adding to global supplies, as the United States and other powers are holding talks on reviving the nuclear deal that nearly stopped Iranian oil from entering the market.

On the other hand, the International Monetary Fund said this week that huge public spending aimed at combating the Covid-19 pandemic may increase global growth to 6% this year, a rate not recorded since the 1970s.

The increase in economic growth will enhance the demand for oil and its products, which will contribute to reducing inventories.