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Oil declines as demand woes overshadow U.S. inventory drop

Oil prices were little changed on Wednesday, supported by a bigger-than-expected drop in U.S. crude inventories but under pressure as rising global COVID-19 cases threatened global fuel demand. U.S. crude inventories fell by 3.2 million barrels in the week to Jan. 8 to 482.2 million barrels, exceeding analysts’ expectations in a Reuters poll for a 2.3 million-barrel drop, as refiners increased crude runs, the Energy Information Administration said. “The strong tick higher in refining activity has resulted in the fifth consecutive draw to oil inventories, pushing them to their lowest since last March,” said Matt Smith, director of commodity research at ClipperData.  

Matt Smith On Energy’s Consistent Rise After Saudi Pledge

Asia LNG Rally Continues with Cargo Bid at $26-Plus — The Offtake

LNG tanker Symphonic Breeze is docked at the Royal Dutch Shell plc floating liquefied natural gas (FLNG) vessel Prelude, according to ClipperData. The firm also said the GasLog Glasgow tanker may arrive at Prelude Jan. 17. The FLNG vessel offshore Australia was taken offline last February after an electrical issue. The company later pushed back its restart to 2021.

U.S. oil prices end above $50 as weekly U.S. crude supplies drop by 8 million barrels

Oil futures climbed Wednesday, with U.S. prices ending above $50 a barrel for the first time in 11 months, as weekly U.S. crude supplies dropped by 8 million barrels, down a fourth straight week. The Energy Information Administration reported a “bullish large draw to crude inventories to close out the year, driven by ad valorem tax considerations,” said Matt Smith, director of commodity research at ClipperData.

Energy Market Shows Signs Of Heating Up After A Turbulent Year

Temperatures are finally starting to feel like mid-December throughout much of the Lone Star State, with many Texans waking up to chilly weather in the mid- to upper 30s Monday morning. But even as the mercury falls, the energy industry appears to be heating up somewhat after a rather devastating year. One notable sign is that oil prices are up to their highest point since March, said Matt Smith, director of commodity research for ClipperData. “Prices have rallied about 40% from the lows of early November,” Smith said. “While it has been because of vaccine optimism, it’s also because we’ve seen some weakness in the U.S. dollar. You see this kind of inverse relationship there where oil prices rise when the U.S. dollar drops, so that’s been helping.”

Oil settles higher with OPEC+ expected to extend output cuts and U.S. crude supplies down a second week

Oil futures settled higher on Wednesday as traders bet that the OPEC+ alliance will extend output cuts into the new year and U.S. government data revealed a decline in domestic crude inventories for a a second week in a row. A “tick lower in refining activity and an increase in imports and production” led to a “minor draw to crude inventories,” said Matt Smith, director of commodity research at ClipperData. A significant drop, however, “in implied demand over the holiday week has resulted in solid builds to both gasoline and distillate inventories, tilting the report bearish on the whole,” he said in emailed commentary.

U.S. crude inventories dip, fuel stocks build amid weak demand: EIA

U.S. crude oil stockpiles fell modestly last week, while gasoline and distillate inventories surged as refiners slowed production amid weakening demand, the Energy Information Administration said on Wednesday.

“A significant drop in implied demand over the holiday week has resulted in solid builds to both gasoline and distillate inventories, tilting the report bearish on the whole,” said Matt Smith, director of commodity research at ClipperData, said referring to the Thanksgiving holiday on Nov. 26.

As Thanksgiving Approaches, Travel Inches Up, But Fuel Consumption Is Still Way Down

The holidays are upon us which, in normal times, means a big season for travel, and for fuel demand. But things are a bit different this year. As COVID cases increase nationwide, many Americans are rethinking their Thanksgiving travels. Still others are pressing on with their plans, albeit against the guidance of health authorities who caution this isn’t the time to be moving about the country. “You’ve got travelers that were screened at U.S. airport security checkpoints, they topped one million last Friday,” said Matt Smith, director of commodity research at ClipperData. “That’s only the second time since March where we’ve seen it that high. So we are seeing that increased activity.” Still, Smith said, air travel is down 40% from this time last year. Gasoline, on the other hand, has seen higher demand than jet fuel, as more travelers avoid airplanes and opt instead to travel in personal vehicles.

Oil And Gas Industry Facing A ‘Sea Change’ Toward Renewable Fuels

As the pandemic continues to strain oil and gas companies, some are using it as an opportunity to more aggressively shift toward the development of renewable fuels. Matt Smith, director of commodity research at ClipperData, tells Texas Standard that the pandemic hastened what was already a “sea change” in the industry toward more renewable #fuels. “The drumbeat is building for peak gasoline demand,” Smith said. “So whether that’s due to the behavioral changes we’ve seen this year in terms of working from home, or if it’s technological advances due to greater fuel efficiency, or if it’s simply just that move towards more electric vehicles, there is that sea change underway.”

Oil skyrockets after Pfizer’s vaccine breakthrough

Oil prices skyrocketed Monday after Pfizer revealed a vaccine breakthrough that could clear some of the black clouds hovering over the energy industry. "Oil is rallying like a mad thing, joining the dots between a potential vaccine and a rebound in global demand growth," said Matt Smith, director of commodity research at ClipperData.