Tariff uncertainty is everywhere
March 12, 2025
The API reports crude oil stocks up 4.2, gasoline stocks were down 4.6, and distillates were up 420,000.
The average estimates for today’s DOE inventory report from the Bloomberg survey are crude stocks up 2.2186, gasoline stocks down 1.585, and distillates down 279,000.
Tariff uncertainty is everywhere and hard to keep up with as tariffs get announced and we are told they are going into effect tomorrow and then as tomorrow comes they are then pulled back. It is hard to set a strategy in this environment. Energy traders are also trying to deal with all this uncertainty and for now that likely means these markets congest and continue to look for clarity.
The news out of CERAWEEK, the world’s premier energy conference, is that the focus on renewables was much too quick and there needs to be a balanced approach to energy that includes investment in hydrocarbon production.
Commerzbank forecast a WTI crude oil price of $70 per barrel by the end of the second quarter. It forecast the price of Brent crude oil at $75 per barrel after the second quarter, as US sanctions against Iran leads to a reduction in oil supply. Separately, according to Commerzbank Research’s Carsten Fritsch, OPEC and its allies could potentially pause their output increase in the third quarter of the year.
Propane inventories are estimated to be down by 1.57 million barrels in today’s inventory update report. Propane inventories are currently at a 1.9 million barrel deficit to the 5-year seasonal average but a shift toward warmer weather will likely keep draws small from here going forward.
India’s petroleum consumption has lost momentum since the fourth quarter of 2024. The country has replaced China as the fastest source of consumption growth, so the loss of momentum has contributed to downward pressure on oil prices.