Traders mostly disregarded the EIA report revealing an unexpected increase in crude oil stockpiles, as crude oil prices increased by 0.37% to settle at $6,190. According to EIA statistics, rather than the market’s estimate of a 2.30 million barrel reduction, U.S. oil stockpiles grew by 1.233 million barrels for the week ending May 31, 2024.
Additionally, there was an 854 thousand barrel increase in crude supplies at the Cushing, Oklahoma delivery hub the week before, after a notable drop of 1.766 million barrels. Distillate stockpiles, including heating oil and diesel, increased by 3.197 million barrels, more than anticipated, while petrol inventories increased by 2.102 million barrels, more than the 1.95 million increase predicted.
OPEC+ agreed to extend most of its production restrictions until 2025, but it also let the eight-member countries’ voluntary reductions be progressively lifted beginning in October. By December, more than 500,000 barrels will be back on the market thanks to this action, and by June 2025, 1.8 million barrels per day should be back on the market.
Furthermore, while product supplied, a proxy for demand, decreased by 0.4% to 19.9 million barrels per day in March, U.S. oil output hit its highest level of the year at 13.2 million barrels per day, up 0.6% from the previous month.
