Saudi Arabia exported less crude oil in April rising inventories in Europe

Same trading pattern is observed in the oil prices yesterday as they did the day before, mostly following the performance of the US dollar. Brent trading at around $64 per barrel, while WTI is priced at $60 per barrel this morning, notes Commerzbank. 

At present supply is plenty in the oil market, which should avert price rise. Data from JODI states Saudi Arabia exported less crude oil in April due to rise in domestic demand. That said, the Saudi Arabian oil minister stressed once again yesterday that his country would scale up production if demand were to increase. This means it is virtually impossible for the oversupply to be reduced via higher demand, says Commerzbank. 

According to PJK International, the oversupply of oil in Saudi Arabia is having an impact on the stock development in Europe. Gasoil stocks in the Amsterdam-Rotterdam-Antwerp region (ARA) rose to 3.03 million tons this week and are again nearing the record level they achieved in February. There is therefore no shortage risk of middle distillates. 

ARA gasoline stocks also saw a increased inventory build for the third consecutive time and are now well above the long-term average again. This should take the wind out of the sails of the recent increase in gasoline crack spreads given that US gasoline stocks had already risen unexpectedly last week, adds Commerzbank.