Oil prices declined on Thursday, 9 January, amid reports of a significant increase in fuel stocks in the United States. According to Reuters, the decline was limited due to expectations of increased demand for fuel in the winter and concerns about supply shortages.
Futures for Brent crude oil decreased by 8 cents to $76.08 per barrel, while US West Texas Intermediate (WTI) crude oil decreased by 11 cents to $73.21 per barrel. On Wednesday, both fell by more than 1%, helped by a stronger US dollar and a larger-than-expected increase in fuel stocks.
Last week, US gasoline stocks increased by 6.3 million barrels to 237.7 million barrels. Distillate stocks rose by 6.1 million barrels to 128.9 million barrels, which was significantly higher than the forecast increase of 600 thousand barrels.
At the same time, crude oil stocks decreased by 959 thousand barrels, which exceeded analysts’ expectations, who had forecast a decline of 184 thousand barrels.
“The increase in US fuel inventories has stimulated some sales, but the impact is limited to winter demand in the northern hemisphere,” said Hiroyuki Kikukawa, president of NS Trading, a division of Nissan Securities.
JPMorgan analysts predict that in January, oil demand will grow by 1.4 million barrels per day year-on-year to 101.4 million bpd. The main factors behind this growth are the increased consumption of heating fuel in the cold winter in the Northern Hemisphere and increased travel in China before the Lunar New Year holidays.
“Global oil demand is expected to remain strong throughout January, driven by cold winter conditions and increased travel in Asia,” the experts said.
Winter remains a key factor influencing the stability of demand, despite temporary price fluctuations due to inventory fluctuations.
