ConocoPhilips reduces global oil demand outlook
May 12, 2025
Energy markets are up strong this morning on the news that trade tension between the US and China have deescalated and a 90-day reduction of US tariffs on China from 145% to 30% will take place and China tariffs on US goods will come down from 125% to 10%. The markets see all this as positive news and the outlook good from an economic impact and prices are rallying on that outlook.
US commercial crude oil inventories decreased by 2 million barrels week-over-week to a total of 438.4 million barrels. US crude oil inventories are 7% below the five-year average for this time of year.
Gasoline inventories increased by 200,000 barrels week-over-week and are 3% below the five-year-average for this time of year.
Distillate inventories decreased by 1.1 million barrels week-over-week and are 13% below the five-year average for this time of year.
Propane inventories increased by 1 million barrels week-over-week and are 11% below the five-year average for this time of year.
Baker Hughes reported that 5 oil rigs came offline last week, and the US total is down to 474 oil rigs. US oil production is slowing and many market participants think it will begin to fall as several firms have announced they will cut rigs due to the low-price environment.
ConocoPhilips CEO said this week his company has reduced its 2025 global demand growth outlook to around 800,000 bpd from a prior forecast of 1 million bpd. While he noted the recent price declines have not affected operations as “60 is pretty close to our mid-cycle planning price.” But he did note that a $50 dollar price could potentially change its outlook for future operations.