Benzinga - by Neil Dennis, Benzinga Staff Writer.
Oil prices fell on Wednesday after U.S. inventory data showed gasoline and distillate stocks grew strongly for a second week, while crude stocks also rose.
In early afternoon trade, Nymex WTI, which had been more than 1% higher earlier, fell back to $72.30 a barrel to leave it flat on the day. Brent crude, which had also been around 1% higher, fell back to $77.53 a barrel, leaving it down by 0.1%.
The exchange-traded fund which tracks the price of U.S. light-sweet crude — the United States Oil (NYSE:USO) — fell 0.1% to $67.35. It had earlier traded as high as $68.68.
Also Read: Oil Prices Fall As Demand Concerns Driven By Massive US Gasoline Stockpile Increase
Gasoline And Distillates Stocks Build
Weekly inventory data from the Energy Information Administration (EIA) showed crude oil stockpiles rose by 1.3 million barrels in the week to Jan. 5, slightly offsetting the 5.5 million barrels drawdown seen in the previous week.Stocks of gasoline continued to grow strongly, with 8 million barrels added during the week. This followed a massive 10.9 million increase in the previous week. Distillate stocks, which include diesel and heating oil, rose by 6.5 million after a 10.1 million barrels increase in the prior week.
“It will be the seventh-consecutive week of distillates stocks increasing, which will further help ease tightness concerns in the middle distillate market,” said Warren Patterson, referring to the risks of having short supplies of heating oil going into the severest winter months.
Flat Prices In 2024 And 2025
The EIA lent further weight to the turnaround in crude prices after publishing a report forecasting flat prices throughout 2024 and 2025.“We forecast average annual crude oil prices in 2024 and 2025 will remain near their 2023 average because we expect that global supply and demand for petroleum liquids will be relatively balanced over the next two years,” said the report’s author Matthew French.
The EIA said that strong growth in petroleum consumption over the past two years was driven by economic growth and a return to pre-COVID-19 pandemic travel patterns. It forecasts global consumption to rise by 1.4 million barrels per day in 2024 and by 1.2 mb/d in 2025.
Pump Prices Remain At 2-Year Low
Meanwhile, U.S. gasoline prices at the pump remained near two-year lows. The average price of a gallon of regular gas on Wednesday afternoon stood at $3.085.“We’re likely to inch down over the next few days, but an arctic blast could have impacts on refineries. Keeping an eye if this could derail our chances of a $2.99 national average,” said Patrick De Haan at Gas Buddy.
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