Market Expects Energy Prices to Move Higher to Slow Down Demand
June 15, 2022
The estimates for today’s DOE inventory report from the Bloomberg survey are estimated to show crude oil supplied down 1.231 million barrels, gasoline supplies up 224,000 barrels and distillates up 168,000 barrels. Refinery run rates are estimated to be up 0.5% to 94.2% of capacity. Refineries look to continue to run at high rates as the margins are good and the supplies are needed.
The API inventory report said crude stocks were up 740,000 barrels and gasoline stocks were down 2.2 million barrels and distillates were up 230,000 barrels.
Energy prices have been volatile the last few days as prices continue to try and determine their direction. The overriding thought is that prices need to go higher in the near term to slow down demand as the price moves so far do not seem to have done enough.
From Bloomberg: Traders have fully priced in a 75-basis point increase from the Federal Reserve today but are eager to know whether Chair Jerome Powell and his colleagues will raise the benchmark by a similar amount next month.
US Senate Finance Committee Chair, Ron Wyden, will propose a 21% surtax on oil company profits that are considered to be excessive.
Saudi state media reported the US President Joe Biden will visit Saudi Arabia on July 15 – 16 where he will meet Saudi King Salman and Crown Price Mohammed bin Salman.
From OPEC’s monthly report: It has kept to its forecast that world oil demand will exceed pre-pandemic levels in 2022 but said Russia’s invasion of Ukraine and developments around the coronavirus pandemic pose a considerable risk to the forecast recovery to pre-pandemic levels.