World Bank Economist Warns Pandemic May Overwhelm Balance Sheets
January 13, 2021
Crude oil stocks on the API were called down 5.8 million barrels and the crude oil stocks at Cushing, Ok were down 232,000 barrels. The average estimates for today’s DOE report is for stocks to be down 2.3 million barrels, per the Reuters survey.
Gasoline stocks in the API report were called up 1.9 million barrels and the expectations for today’s DOE are stocks up 2.7 million barrels.
Distillate stocks were up 4.4 million barrels in the API report and the estimate for today is for them to be up 2.7 million barrels.
Despite the likelihood of builds to refined product stocks and cases of COVID-19 on the rise the market continues to over looks these near term facts and looks out longer term. As the coronavirus rollouts happen across the globe, the US Dollar trades to a two and half year low and equites continue higher traders appear to be looking for a reason to buy with the macro outlook positive beyond 3 to 5 months.
World Bank Chief Economist Carmen Reinhart had a warning for anyone looking for a fast recovery, saying that the pandemic may overwhelm balance sheets, triggering a financial crisis. Governments around the world are bringing in even more restrictions to slow the spread of the virus. Contrast that comments with reports from some Federal Reserve officials who said they see the possibility of a strong economic rebound, driven by more fiscal support and vaccination numbers, which could set the stage for a discussion on tapering bond purchases before year end.
The estimates for this week’s propane inventory report is calling for a draw of 4.13 million barrels. The five year averages for this reporting week of the year is a drop of 1.486 million barrels. The outlook is for a much larger declined than average with exports being the biggest factor contributing to the larger draws over the last month.
The EIA estimates that global consumption of petroleum and liquid fuels averaged 92.2 million barrels per day for all of 2020, down by 9.0 million barrels per day from 2019. EIA expects global liquid fuels consumption will grow by 5.6 million barrels per day in 2021 and another 3.3 million barrels per day in 2022.