0327 GMT: Crude oil futures were rangebound in mid-morning trade in Asia April 7 as a build in US gasoline stocks countered a stronger macroeconomic outlook in two closely-watched reports released late April 6.
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At 11:27 am Singapore time (0327 GMT), the ICE Brent June contract was up 9 cents/b (0.14%) from the April 6 settle at $62.83/b, while the May NYMEX light sweet crude contract was 7 cents/b (0.12%) higher at $59.40/b.
US gasoline inventories rose by 4.5 million barrels in the week ended April 2, American Petroleum Institute data released late April 6 showed, higher than analyst expectations.
“The oil market has trouble finding its feet, let alone an equilibrium, as the apparent buyers’ strike continues after the API reported an unexpected hefty build in gasoline inventories,” Axi chief global markets strategist Stephen Innes said in a note April 7.
Indirect talks between the US and Iran regarding a revival of a nuclear deal that would lift sanctions on Iranian crude oil exports were considered constructive by both sides, S&P Global Platts reported. Iran has increased crude exports this year, especially to China, despite the sanctions, and sanctions relief could further raise supply and weigh on prices.
However, downward pressure on prices was countered by upward revisions to the International Monetary Fund’s World Economic Outlook and the US Energy Information Administration’s Short-Term Energy Outlook reports released late April 6.
“Optimism on the global economic outlook boosted sentiment in the crude oil market,” ANZ Research analysts said in a April 6 note.
The IMF forecast 6% global economic growth in 2021 and 4.4% growth in 2022, revising up its projections by 0.8% and 0.2% respectively from October 2020, which it attributed to additional fiscal support in major economies and vaccine-backed economic recovery in the second half of 2021.
The EIA forecast US gasoline consumption to rise to 8.6 million b/d in 2021 from 8 million b/d in 2020 as a result of rising GDP and employment levels and the widespread rollout of COVID-19 vaccinations.
Market participants will look to the weekly US oil inventory report by the US Energy Information Administration due for release later April 7 for fresh pricing cues on the supply outlook.